Daily Market Analysis – 20260406 – A Penguin's Perspective

DMA of 2026 APRIL 06 MONDAY AMC.

The S&P 500 (+0.4%), Nasdaq Composite (+0.5%), and DJIA (+0.4%) recorded modest gains to start the week, trading in a stable range throughout the day amid a relatively quiet session.

There were no material changes surrounding negotiations between the U.S. and Iran, which kept both oil prices and stocks free from any major swings today. Axios reported that the U.S. and Iran were involved in mediated discussions for a potential 45-day ceasefire, but later reports stated that Iran is not interested in a temporary solution.

In a 1:00 p.m. ET press conference, President Trump reiterated his threat of strikes against Iranian power plants and bridges if a deal is not negotiated before the previously imposed deadline of Tuesday at 8:00 p.m. ET. The press conference was relatively devoid of any new developments, and while the major averages dipped toward their baselines in reaction to the threat of further escalation, they quickly reclaimed their modest gains.

Crude oil futures settled today’s session $0.77 higher (+0.7%) at $112.25 per barrel.

Strength across the stock market was broad, though the gains were largely modest in nature.

The consumer discretionary sector (+0.8%) notched the widest gain, supported by gains in nearly all of its components that overshadowed a weak showing from Tesla (TSLA 352.82, -7.77, -2.15%).

The energy sector (+0.8%) captured a similar gain amid the modest increase in oil prices.

Memory storage names saw another day of sharp gains after Morgan Stanley reaffirmed its Overweight rating for Seagate Tech (STX 453.30, +23.94, +5.58%) and Western Digital (WDC 304.15, +9.18, +3.11%), helping the PHLX Semiconductor Index finish 1.1% higher while the broader information technology sector gained 0.5%.

Meanwhile, the utilities (-0.4%), health care (-0.4%), and materials (-0.4%) sectors finished modestly lower.

Outside of the S&P 500, the Russell 2000 (+0.4%) and S&P Mid Cap 400 (+0.5%) posted similar gains to those of the major averages.

Corporate news flow was on the lighter side today, though there was some merger and acquisition activity with Neurocrine Biosciences (NBIX 132.48, +0.88, +0.67%) agreeing to acquire Soleno Therapeutics (SLNO 52.26, +12.77, +32.34%) for $53 per share in cash.

Altogether, some lingering optimism remains that a last-minute ceasefire agreement could still be reached. However, a cautious tone continues to prevail, keeping the S&P 500 and DJIA pinned just below their 200-day moving averages, while the Nasdaq Composite remains further behind.

BENCHMARK INDICES YEAR-TO-DATE

S&P Mid Cap 400: +3.6% YTD
Russell 2000: +2.4% YTD
DJIA: -2.9% YTD
S&P 500: -3.4% YTD
Nasdaq Composite: -5.4% YTD

MARKET INTERNALS

DOW closed higher at 46670 (+0.36%).
Nasdaq closed higher at 21996 (+0.54%).
S&P 500 closed higher at 6612 (+0.44%).
Action came on lower than average volume (NYSE 1,038 mln vs avg. of 1,436 mln; NASDAQ 8,069 mln vs avg. of 9,077 mln),
Advancing/declining volume for NYSE (622 mln/395 mln) and Nasdaq (5505 mln/2516 mln).
Advancers led decliners (NYSE 1714/1038; NASDAQ 2997/1824)
New 52-week highs outpacing new 52-week lows (NYSE 42/22, NASDAQ 91/81).

After-Hours Action

US stocks trended higher on Monday as the Nasdaq 100 gained 0.8%, the S&P 500 rose 0.6%, and the Dow climbed 0.5% amid hopes for a Middle Eastern ceasefire. Market volatility remained elevated as traders weighed conflicting reports of a proposed 45-day truce against the looming 8 p.m. Tuesday deadline for military escalation. While news of a potential framework to reopen the Strait of Hormuz briefly pressured energy markets, crude futures ended the session higher at above $112 per barrel. Large-cap technology stocks provided significant support to the broader indexes as Alphabet and Amazon each gained more than 1% while Micron Technology surged 3.2%. These gains helped offset a 2.2% slide in Tesla and a 1% drop in Eli Lilly. Despite the hopeful rhetoric surrounding diplomatic mediation, caution persisted as the market may still be underestimating the long-term economic impact of regional energy disruptions and higher for longer fuel costs.

BONDS AND YIELDS

U.S. Treasuries began the week in mixed fashion with relative strength in longer tenors allowing the long bond to reclaim its loss from Friday’s abbreviated session while the short end underperformed, extending Friday’s losses. Those losses were incurred in reaction to the Employment Situation report for March, which beat headline expectations by a wide margin, masking some softness on the earnings side. The headline-grabbing elements showed the addition of 178,000 nonfarm payrolls and a dip in the Unemployment Rate to 4.3% from 4.4%. On the negative side, a deceleration in average hourly earnings growth to 3.5% from 3.8% year-over-year and a dip in the average workweek to 34.2 from 34.3 hours exerted some, albeit mild, pressure on average weekly earnings (-0.1%). Friday’s abbreviated session, which took place despite Wall Street’s closure, was followed by a weekend that did not feature signs of deescalation in the Iran conflict. On the contrary, President Trump threatened to attack Iran’s bridges and energy infrastructure if negotiations don’t bear fruit by tomorrow night. Crude oil briefly overtook $115/bbl on Sunday evening after the threat was made, but settled with just a portion of that advance, rising despite news that OPEC+ agreed to increase its daily output by 206,000 barrels in May. As for Treasuries, they opened on lows, rallying back toward Thursday’s closing levels in early action. The rebound was sustained after the ISM Services report for March (54.0%; Briefing.com consensus 54.9%) missed expectations with its employment component contrasting starkly with the newfound growth in March nonfarm payrolls. Treasuries edged to fresh highs after President Trump’s afternoon press conference was essentially a rerun of threats made over the weekend, settling near their best levels. Crude oil ended the day just north of $112/bbl while the U.S. Dollar Index dipped 0.1% to 99.99.

Yields

2-yr: +2 bps to 3.85% (+5 bps from Thursday’s settlement)
3-yr: +1 bp to 3.87% (+4 bps from Thursday’s settlement)
5-yr: -1 bp to 3.98% (+3 bps from Thursday’s settlement)
10-yr: -2 bps to 4.33% (+2 bps from Thursday’s settlement)
30-yr: -3 bps to 4.89% (UNCH from Thursday’s settlement)

CURRENCIES

The dollar index pared its early gains and fell below 100 on Monday, as traders reacted positively to reports that Iran, the US, and a group of regional mediators are discussing a potential 45-day ceasefire that could pave the way toward ending the war. Additional reports indicating that more ships are passing through the Strait of Hormuz helped ease pressure on oil prices, offering some temporary relief. This comes amid President Trump’s threat to target Iran’s power plants starting Tuesday, while Iran continues striking energy infrastructure in neighboring Gulf countries. Investors are now awaiting a series of key economic releases that will provide further insight into the health of the economy, including the CPI report later this week and the FOMC minutes. Markets have fully priced in the Fed will leave the federal funds rate steady later this month and expect borrowing costs to remain unchanged throughout the year.

Currencies

EUR/USD: +0.2% to 1.1544
GBP/USD: +0.4% to 1.3236
USD/CNH: -0.1% to 6.8766
USD/JPY: UNCH at 159.69

Offshore Yuan Extends Gains
The offshore yuan strengthened to around 6.87 per dollar on Monday, extending gains from the previous week in thin holiday trading, even as geopolitical risks remained elevated. Tensions in the Middle East continue to cloud market sentiment, with US allies such as Pakistan, Egypt, and Turkey reportedly working to broker a roughly 45-day ceasefire aimed at averting potential US strikes on Iran’s energy infrastructure and possible retaliation from Tehran. The latest developments follow President Donald Trump’s decision to extend his deadline to Tuesday for Tehran to reopen the Strait of Hormuz. However, Iran has rejected Washington’s ultimatum, stating it will only fully reopen the waterway once war-related damages are compensated. Domestically, investors are turning their focus to upcoming inflation data due later this week. Consumer inflation is expected to ease slightly, while producer prices are projected to post its first annual increase since September 2022.

Pound Near Four-Month Low on Iran Tensions
The British pound traded near $1.32, close to its lowest level since late November, as uncertainty over the Iran conflict and surging oil prices weighed on markets. At the same time, the dollar remained supported as stronger-than-expected US jobs data last week further dampened expectations of Federal Reserve rate cuts. US President Trump warned Iran of severe repercussions if it fails to reopen the Strait of Hormuz by Tuesday, though US intelligence suggests little chance of compliance. Meanwhile, reports indicate negotiations for a 45-day truce between the US, Iran, and regional mediators, which could help de-escalate tensions. With crude prices near multi-year highs, inflation concerns have led investors to rule out Fed rate cuts this year. In the UK, markets now expect two Bank of England rate hikes in 2026, reversing pre-war forecasts of two cuts. This shift persists despite Governor Andrew Bailey’s caution that markets may be overestimating the likelihood of tightening.

Euro Remains Under Pressure Amid Iran Tensions
The euro held steady at $1.152 in subdued trading, amid escalating uncertainty over the prolonged Iran conflict and rising oil prices, while stronger-than-expected US jobs data last week further diminished hopes of Federal Reserve interest rate cuts. US President Trump threatened Iran with severe consequences if it fails to reopen the Strait of Hormuz by Tuesday, though US intelligence suggests compliance is unlikely. Reports also indicate negotiations for a 45-day truce between the US, Iran, and regional mediators, potentially easing the conflict. Crude prices remained near multi-year highs, fueling inflation concerns and prompting investors to rule out any Fed rate cuts this year. In Europe, market expectations have shifted dramatically, with investors now anticipating three interest rate hikes in 2026, a stark contrast to pre-conflict forecasts, which had leaned toward no hikes and even speculation about potential monetary easing.

COMMODITIES

Brent crude futures rose to toward $111 per barrel and WTI crude futures rose toward $114 per barrel on Monday as the market reacted to Iran’s formal rejection of a 45-day ceasefire proposal and President Trump’s latest remarks. During a news conference President Donald Trump reiterated a strict Tuesday 8 p.m. deadline for Tehran to reopen the Strait of Hormuz or face the destruction of its power plants and bridges. Iran’s Foreign Ministry dismissed the temporary truce through Pakistani mediators and demanded a permanent end to hostilities and the lifting of sanctions as a prerequisite for any agreement. Physical market tightness remains with Dated Brent surging above $140 and Saudi Arabia raising its flagship Arab Light prices to a record premium of $19.50 over regional benchmarks. Traffic remains 90% below pre-conflict levels as major exporters face significant disruptions. Israel struck Iran’s largest petrochemical facility overnight while Tehran targeted energy infrastructure in Kuwait.

The spread between Brent and WTI is currently at $3.38

Commodities

Crude Oil +0.77 @ 112.25
Nat Gas +0.01 @ 2.81
Gold +4.00 @ 4683.20
Silver -0.02 @ 72.90
Copper +0.06 @ 5.60

Gold Pares Losses
Gold prices pared earlier losses to trade around $4,680 an ounce on Monday amid a softer US dollar amid reports of a Pakistan-brokered ceasefire proposal. Investors weighed the potential for a 45-day truce which offered bullion some relief from the forced liquidations seen throughout March. However pressure still remains from a resilient labor market after Friday’s jobs report showed 178,000 positions added in March and an unemployment rate of 4.3% which reinforced expectations for the Federal Reserve to keep interest rates restrictive. This higher-for-longer policy outlook continues to weigh on non-yielding assets even as President Donald Trump’s looming Tuesday deadline for strikes on Iranian infrastructure keeps a geopolitical floor under the market. Tehran’s refusal to reopen the Strait of Hormuz as part of a temporary deal maintains significant supply-side inflation risks which further complicates the path for bullion. Gold remains down roughly 12% since the conflict began.

Rubber Futures Near 1-Month High
Rubber futures rose slightly above 201 US cents per kilogram, approaching a one-month high of 203 US cents hit on April 1st. Geopolitical tensions in the Middle East, along with elevated crude oil prices, are driving up synthetic rubber costs, boosting demand for natural rubber. Global shipping disruptions continue to pose risks to the supply of critical raw materials such as chemicals, petrochemical derivatives, and synthetic rubber. At the same time, supply remains constrained as Southeast Asia, the main producing region, stays in its low-production “wintering” season until June.

Silver Extends Fall Despite Ceasefire Talks
Silver fell toward $72 an ounce on Monday, extending losses from the previous session as investors assessed reports of a potential ceasefire in the Middle East. The US, Iran, and a group of regional mediators are reportedly discussing terms for a possible 45-day ceasefire that could pave the way for an end to the conflict. Meanwhile, President Donald Trump issued a fresh ultimatum to Iran, warning of strikes on its power plants and other civilian infrastructure if the Strait of Hormuz is not reopened. Tehran has rejected the latest demand and continues to target energy assets across the region. Silver has declined more than 20% since the conflict began, as surging energy prices fueled inflation concerns and strengthened expectations of interest rate hikes. The metal has also struggled to perform its traditional safe-haven role, pressured by forced liquidations as investors moved to cover losses in other markets.

Copper Rises as Risk Sentiment Improves
Copper futures climbed toward $5.6 per pound on Monday, rebounding from the previous session’s losses as market sentiment improved on hopes for a ceasefire in the Middle East. The US, Iran, and a group of regional mediators are reportedly negotiating terms for a potential 45-day truce that could pave the way for a more lasting resolution to the conflict. This development helped ease concerns after President Donald Trump recently set a new deadline for Iran and escalated threats against its power plants and other civilian infrastructure if the Strait of Hormuz is not reopened. Copper had been under pressure as rising energy costs and risks of supply disruptions weighed on the outlook for industrial demand and global growth. The metal also remains lower for the year amid ample supply and increasing inventories, with London Metal Exchange stockpiles near six-year highs and Shanghai Futures Exchange holdings close to record levels.

Palm Oil Subdued as Week Begins
Malaysian palm oil futures were little changed, hovering around MYR 4,840 per tonne after two sessions of gains. The closure of China’s Dalian exchange for a holiday offset weakness in Chicago soyoil prices. Sentiment stayed cautious amid escalating geopolitical tensions, with U.S. President Trump’s repeated threats against Iran and fears of Gulf retaliation adding volatility across commodities. On the supply side, a Reuters poll ahead of official monthly data suggested Malaysia’s inventories likely saw their steepest draw in three years in March, falling to the lowest since July. Meantime, cargo surveyors estimated shipments surged 44%–57% mom. Separately, top supplier Indonesia reported double-digit palm oil export growth in February as the sector prepares for a higher B50 biodiesel mandate in July. Regarding demand, March imports by India, the world’s largest consumer, dropped 19% to a three-month low, with refiners delaying purchases amid elevated prices.

ROTW UPDATES

Equity indices in the Asia-Pacific region began the week on a mixed note while markets in China, Hong Kong, Australia, and New Zealand were closed for holidays.

Japan’s Nikkei: +0.6%,
Hong Kong’s Hang Seng: HOLIDAY,
China’s Shanghai Composite: HOLIDAY,
India’s Sensex: +1.1%,
South Korea’s Kospi: +1.4%,
Australia’s ASX All Ordinaries: HOLIDAY.

In news:

Japan’s Prime Minister Takaichi will travel to Australia to secure Japan’s rare earth supply chain and discuss cooperation regarding the Strait of Hormuz.
China’s government reported that its consumer goods trade-in program generated revenue of CNY433 bln in Q1.
India purchased its first shipment of crude oil from Iran since 2019.

In economic data:

India’s March Services PMI 57.5 (expected 57.2; last 57.2)
Singapore’s February Retail Sales -4.1% m/m (last 6.0%); 8.3% yr/yr (last -0.5%)

Major European markets remain closed for Easter, scheduled to reopen tomorrow.

In news:

The overall narrative has remained focused on the developments in the U.S.-Iran conflict with Iran facing a Tuesday deadline to loosen its grip on maritime traffic through the Strait of Hormuz or face crippling strikes on its bridges and energy infrastructure.
Meanwhile, the Bank of England is split on a best approach to the oil-related inflationary spike, according to FT.
The Bank of Italy trimmed its 2026 growth forecast to 0.5% from 0.6% while the outlook for 2027 was reduced to 0.5% from 0.8%.

In economic data:

Spain’s March Unemployment Change -22,900 (expected 10,300; last 3,600)

U.S. ECONOMIC UPDATES

March ISM Non-Manufacturing Index 54.0% (Briefing.com consensus 54.9%); Prior 56.1%
- The key takeaway from the report is that the services sector remained in expansion, but the Employment Index returned to contraction while the Prices Index saw its biggest one-month increase in over 13 years. This combination will present a headwind to growth, especially if it persists in the coming months.

The U.S., Iran, and mediators are discussing terms of a 45-day ceasefire agreement, which could lead to the end of the war, but sources say chances of reaching a deal are “slim.”, according to Axios
President Trump, in an interview, says there is a “good chance” a deal with Iran could be reached by tomorrow, but if no deal is reached, the U.S. “will blow up everything” in Iran, according to Axios
Strait of Hormuz tariff reached highest level in weeks, according to Bloomberg
Iran shot down a U.S. fighter jet and attacked oil and gas infrastructure in Gulf states, Bloomberg
Iraq oil tankers can now cross through the Strait of Hormuz because of an Iranian exemption, according to Bloomberg
The two crew members from the shot down a F-15 fighter jet were rescued, according to Axios
Saudi Arabia, Russia, Iraq, UAE, Kuwait, Kazakhstan, Algeria, and Oman adjust production and reaffirm commitment to market stability
White House releases FY27 budget; requests $1.5 trillion for defense a 44% increase; cuts green energy programs
President Trump directed the Secretary of Homeland Security, in coordination with the Director of the Office of Management and Budget, to use funds that have a reasonable and logical nexus to the functions of DHS to provide each and every employee of DHS with the compensation
House Speaker Mike Johnson will not hold vote on DHS funding until Senate makes progress on funding immigration enforcement through reconciliation, which could take two weeks, according to Axios
President Trump is considering removing Commerce Secretary Howard Lutnick and Labor Secretary Lori Chavez-DeRemer, according to Politico
Oil companies are showing interest in deepwater field stake, according to Reuters
Judge rejects DOJ bid to reinstate subpoenas in Fed case, according to Axios
Five EU nations want windfall energy tax on energy companies, according to Reuters
Class 5-8 truck orders increased 126% yr/yr in March, Act Research
Appeals Court rules that New Jersey can not regulate Kalshi’s prediction markets, according to Reuters
FAA wants to hire 2300 air traffic controllers, according to Reuters
U.S. military making plans for possible strikes on energy targets in Iran, according to WSJ
The Artemis II crew have set the record for the farthest distance from Earth traveled by a human mission

US Services Sector Slows in March
The ISM Services PMI fell to 54 in March 2026 from 56.1 in February which was the highest since August 2022 and compared to forecasts of 55. The reading pointed to a slowdown in services activity, led by an ease in business activity (53.9 vs 59.9) and the first drop in employment in four months (45.2 vs 51.8). Also, the prices index rose to 70.7, the highest since October 2022 from 63 in February, amid higher oil and fuel costs and the supplier deliveries index indicated slower performance compared to February (56.2 vs 53.9), also unsurprisingly with shipping issues and flight disruptions due to the Middle East conflict and winter weather. Meanwhile, inventories (54.8 vs 56.4) and order backlogs (53.6 vs 55.9) eased while new orders rose faster (60.6 vs 58.6). “The predominant commentary this month was about impacts and adjustments due to the conflict with Iran and the expected flow through of higher oil prices at some point”, Steve Miller, Chair of the ISM said.

EARNINGS SEASON AND GUIDANCE

AerCap (AER) reports strong Q1 activity with 286 transactions and $3 bln in financing
AbbVie (ABBV) updates Q1 and FY26 guidance excluding the impact of acquired IPR&D and milestones expense that may be incurred in 2026
Biogen (BIIB) expects that its GAAP and non-GAAP results for the first quarter of 2026 will include acquired in-process research and development, upfront and milestone expense of approximately $34 million on a pre-tax basis
Citigroup (C) disclosed historical quarterly financial data supplement for the five-year quarterly and annual periods ended December 31, 2025 to facilitate comparability
Embraer SA (EMBJ) delivered 44 aircraft in 1Q26, up 44% yr/yr
Figure Technology Solutions (FIGR) reports preliminary March & Q1 2026 Operating Data
fuboTV (FUBO) releases adjusted EBTIDA outlook and long-term financial targets
HDFC Bank (HDB) discloses Q1 metrics – average advances under management +10% yr/yr
Lucid Group (LCID) reports Q1 deliveries impacted by supplier issue, reaffirms production outlook
Nerdy (NRDY) sees FY26 revs in line
Newtek (NEWT) reports 40% growth in Q1 loan originations; reaffirms Q1 and FY26 EPS guidance
Niu Technologies (NIU) reports Q1 unit sales up 29%, driven by China growth
Riot Platforms (RIOT) announces Q1 production and operations update
Tesla (TSLA) March South Korea sales rise 300%, according to Reuters
Trilogy Metals (TMQ) reported first quarter fiscal 2026 results and provides update on U.S. federal strategic investment and project advancement
VinFast Auto (VFS) reports record orders and dealer shipments for electric scooters in March 2026 in Vietnam

2026 APR 07

Pre-Market: None

After-Hours: GBX LEVI PXED

THE WEEK AHEAD

WEEK 15: MONDAY TO FRIDAY, APRIL 06 to APRIL 10

According to the PTSD*, Week 15 has FIVE trading days and is the SECOND trading week in April 2026. The next Market Holiday is on MONDAY MAY25. Seasonally, Week 15 has a Bullish outlook, leading to an even greener week 16 and 17. April is the last of the “6 months of bullishness” on the SPX.

We also need to keep in mind that with the current POTUS, seasonals can easily go out of whack.

*PTSD – Penguin Trader Seasonal Data.

BENCHMARK INDICES (21-YEAR AVERAGE)

The Stock Trader’s Almanac’s stats for the Benchmark Indices for 2026 APRIL 07 of Week 15 over a 21-year average are:

Dow Jones (DJIA): Mildly Bullish 57.1%
S&P 500 (SPX): Mildly Bullish 57.1%
NASDAQ (COMP): Mildly Bullish 52.4%
*Russells 2000 (RUT): Mildly Bullish 57.1%

*The RUT is not listed in the STA; several penguins with a slide ruler calculated the 21-year average.

BENCHMARK INDEX ETFs

The Penguin Trader Seasonal Data (PTSD) stats for the Benchmark Index ETFs for 2026 APRIL 07 of Week 15 over a 15-year average are:

DIA – (15yr Avg): Mildly Bearish 46.7%
SPY – (15yr Avg): Mildly Bullish 60.0%
QQQ – (15yr Avg): Mildly Bearish 40.0%
RUT – (15yr Avg): Mildly Bullish 53.3%

ECONOMIC DAY AHEAD

For USA’s upcoming economic calendar features:

:30 ET: February Durable Orders (Briefing.com consensus 0.5%; prior 0.0%) and Durable Orders ex-transport (Briefing.com consensus 0.5%; prior 0.4%)
15:00 ET: February Consumer Credit (Briefing.com consensus $7.0 bln; prior $8.1 bln)

ANALYSIS

A penguin will be volunteered for this post soon, or if incentivised with enough cheese.

COMMENTARY

Volumes look lower than normal, and while volatility and prices are still high, the markets traded like it was “back to normal”.
The spread of Brent and WTI has returned to positive, and some ships are crossing the straits.

On the home front, my IC is just flapping away.

Stay Hedged – My Penguin Friends

(Excerpts from briefing.com, tradingeconomics.com, financialscents.com, factset.com, finviz.com, marketwatch.com, etrade.com, yahoo.com, tigerbrokers.com, tradingview.com, tradingcentral.com, theedgemalaysia.com, sectorspdrs.com, Investopedia.com, and CNBC.com)