Daily Game Plan

TODAY’S GAME PLAN:  from the trading
desk, this is not research

TODAY’S ECONOMIC DATA:   10:00ET
Factory Orders, Durable Goods Orders, Cap Goods; 12:50ET Fed’s Williams speaks

Highlights and News:  

• Trump Proposes Guiding Neutral Ships Through Strait of Hormuz
• Iran’s Fars News agency reported that two missiles hit a US warship passing through Strait of Hormuz
• Senior US official denies a US ship was hit by Iranian missiles: Axios
• Vessels offending IRGC maritime protocol will be stopped by force: Spokesperson
• China orders companies to defy US sanctions for first time
• Trump said two commercial ships flying American flag successfully passed through the Strait of Hormuz
• GameStop pitches $56 billion takeover of eBay
• Spirit Aviation ceased operations, leaving travelers stranded across the US
  
• Risky asset fund inflows exceeded safe asset inflows by a record $220 billion over the last 4 weeks

Global stocks fluctuated as investors were focused on developments in the Middle East conflict at the start of a week packed with earnings and economic data. Iran’s
military warned US forces against entering the Strait of Hormuz, hours after President Trump announced that the United States would begin helping to free ships stranded in the Persian Gulf.  The US military will provide support, including the use of guided-missile
destroyers, aircraft and drones, as part of an operation dubbed Project Freedom. The Wall Street Journal reported that the plan didn’t currently involve Navy escorts. Iran gave the plan a cool reception, warning that any US interference in the Strait of Hormuz
would violate the ceasefire, Al Mayadeen reported, citing the head of Iran’s parliament National Security Commission. Stocks slipped after Iran’s Fars News agency reported that two missiles hit a US warship when it tried to pass through the Strait of Hormuz.
This was later denied by a senior US official, according to an Axios report, and stocks recovered some losses. US-Iran negotiations continued over the weekend, with both sides carefully assessing each other’s responses.  Markets in China, Japan and the UK
are closed today for public holidays, damping liquidity.

EQUITIES: 

US equity futures trimmed an earlier decline after reports that the United States denied any US ship was struck by Iranian missiles while attempting to transit the Strait of Hormuz. Trump
said over the weekend that the US will begin guiding out some neutral ships trapped in the Persian Gulf starting today. That’s after announcing he was sticking with a naval blockade of Iranian ports, heightening concerns that the vital Strait of Hormuz could
remain effectively closed for some time. Trump also said that representatives were having discussions with Tehran that could lead to something “very positive,” but didn’t offer additional details. The S&P 500 Index extended a record-breaking streak Friday
to mark a fifth week of gains, following solid earnings from tech mega caps.

Futures ahead of the bell: E-Mini S&P -0.1%, Nasdaq +0.1%, Russell 2000 -0.15%, DJI -0.3%

In pre-market trading, Celcuity (CELC) jumped 16% after its Phase 3 VIKTORIA-1 trial testing gedatolisib with fulvestrant in PIK3CA-mutant breast cancer patients successfully hit its
primary endpoint. Meanwhile, eBay (EBAY) surged 10% on news that GameStop is proposing to acquire the e-commerce giant for roughly $56 billion in cash and stock — a bold move by Ryan Cohen to take over a company several times GameStop’s size. GameStop (GME)
itself slipped 4.8%, reflecting investor skepticism about the deal. On the crypto front, Circle Internet (CRCL) gained 6.1% alongside a broader rally in crypto-linked stocks as Bitcoin climbed to $80,000. On the downside, Prudential Financial (PRU) fell 1.6%
after Morgan Stanley downgraded the stock to Underweight. Global Business Travel Group (GBTG) gains 57% after Long Lake Management agreed to buy the company for $9.50 per share in an all-cash transaction valued at about $6.3 billion. Norwegian Cruise (NCLH)
falls 7% after the cruise-line operator gave a forecast for second-quarter profit that missed expectations and slashed a full-year outlook. Palantir Technologies Inc. is heading into its first-quarter earnings with something to prove to investors after being
caught up in a selloff of software stocks. Palantir (PLTR) is set for another sales record, with government and commercial segments contributing almost equally to an expected $1.5 billion haul

European gauges are trading mixed to lower this morning, hit session lows after Iran’s Fars agency claimed two missiles struck an American patrol boat; the Euro Stoxx
50 dropped as much as 1.8%, though the US has not confirmed the incident. European auto stocks came under pressure after President Trump threatened to raise EU automobile tariffs to 25% this week from the previously agreed 15%, citing non-compliance with last
year’s trade deal. Umicore shares rise as much as 16% after the Belgian materials technology group said it expects group adjusted Ebitda for FY2026 to approach €1 billion, significantly above estimates.  Sinch gains as much as 20%. The company, which sells
cloud communication services, tracked gains in Twilio, which reported profit that beat analyst estimates and revenue growth forecasts. Airbus rose as much as 2.5% on news that AirAsia X is nearing a deal to buy around 150 A220 aircraft. Stoxx 600 -0.4%, DAX
~flat, CAC -0.8%, FTSE 100 CLOSED. Utilities -1.6%, Insurance -1.4%, Media +0.8%, Defense +0.6%.  

Shares in Asia gained as AI chipmakers drove Taiwanese and South Korean stock benchmarks to record highs, helping the MSCI Asia Pacific Index fully erase its post-Iran
conflict losses. The MSCI Asia Pacific Index jumped 2%, with tech-heavy benchmarks in South Korea and Taiwan surging more than 4.5% each. The AI theme has returned to the forefront as last month’s ceasefire agreement between the US and Iran calmed investor
nerves. Shares of SK Hynix soared nearly 13% to a record, while TSMC’s jumped over 6% to their all-time high. Samsung’s stock also jumped more than 5% to a record. Markets in mainland China and Japan were among those shut for holidays. South Korean stocks
related to the EV battery supply chain advance, with analysts pointing to improving EV demand, potential lithium price hikes and earnings outlook. Kospi +5.1%, Taiwan +4.6%, Philippines +1.9%, Hang Seng Index +1.2%, Sensex +0.5%, Singapore +0.2%, Indonesia
+0.2%. ASX 200 -0.4%.

FIXED INCOME: 
 

Treasuries are lower as oil prices rise amid heightened Middle East tensions after President Trump said the US would guide stranded ships through the Strait of Hormuz.
US yields are 2bp-3bp cheaper across the curve with 2s10s flat and 5s30s -1bp. IG dollar issuance slate includes one small deal so far. Dealers expect about $40 billion of supply this week and about $175 billion for the month. Treasury auctions resume next
week with 3-, 10- and 30-year sales.

METALS: 

Gold fell following a second weekly decline as Trump said in a social media post on Sunday that the US will begin guiding some ships that aren’t involved in the Iran
conflict out through Hormuz starting Monday. However, Iran’s military warned that US forces would be attacked if they entered the Strait of Hormuz. The energy-supply shock caused by the US-Iran conflict has added to inflation risks, raising the likelihood
that central banks will keep rates steady for longer or even hike them. Spot gold -1%, Silver -2%, Copper futures -0.9%. 

ENERGY:   

Oil prices rose after President Trump’s plan to help vessels exit the Strait of Hormuz drew skepticism from shipowners and open defiance from Iran, which said US
forces would be attacked if they entered the strait.  According to the Wall Street Journal, the operation will not include US Navy escorts. Instead, the US plans to provide ships with guidance on safe routes through the Strait of Hormuz and coordinate directly
with shipping companies and insurers. Dealers noted a bulk carrier had reported being attacked by multiple small craft while transiting past Sirik in Iran on Sunday, though it was not clear how many ships would try to run through the Strait of Hormuz even
with Navy protection. Brent rose more than 5% to trade above $114 a barrel, before paring some of the gain. Unverified Iranian media reports claimed two missiles hit an American patrol boat after disregarding warnings. Axios later reported the US denied an
American ship was hit. Over the weekend, OPEC+ agreed to a symbolic rise in June quota levels, as the group sought to send a business-as-usual message after the exit of the United Arab Emirates. The UAE said one of its oil tankers was attacked by two Iranian
drones while transiting the Strait of Hormuz, without specifying the date of the attack. The Emirati Foreign Ministry attributed the attack to the IRGC, calling the move “economic blackmail that amounts to piracy.” WTI +1.6%, Brent +2.6%, US Nat Gas +0.7%,
RBOB +0.7%.

CURRENCIES: 

In currency markets, the dollar rose after Iran’s FARS news agency claimed that two missiles had hit a US warship, following Trump’s announcement to guide ships through
the Strait of Hormuz. Traders remain on watch for further FX intervention amid thin liquidity with Japanese and UK markets closed. The yen surged briefly against the dollar, triggering renewed speculation that Japanese authorities are preparing another intervention
to support the battered currency. The yen climbed as much ‌as 0.75% before unwinding the entire move, with much of the appreciation coming during a nine-minute stretch. Japanese Finance Minister Satsuki Katayama said “no comments” when asked if authorities
intervened in the market today. The euro edged lower after German Chancellor Friedrich Merz sought to downplay a rift with Trump after the US announced plans to draw down troops from Germany. Aussie$ slips after hitting its highest level versus the dollar
since October 2022. The Reserve Bank of Australia is due to announce its next policy decision tomorrow, with most analysts expecting a hike in the cash rate to 4.35%. US$ Index +0.3%, GBPUSD -0.2%, EURUSD -0.2%, USDJPY +0.05%, AUDUSD -0.3%, NZDUSD -0.2%, USDCHF
+0.3%, USDCAD +0.2%, USDSEK +0.5%, USDNOK -0.4%.

Spot Bitcoin -0.1%, Spot Ethereum +0.3%.  Bitcoin briefly surpassed $80,000 for the first time since January, supported by institutional inflows and regulatory optimism.

Colors within the report:
Green is always the 200 period (day, week).
Red is always 21,
Blue = 50,
Brown =
100 *Stars have added importance 

• Upgrades
• Acadia Health (ACHC) Raised to Strong Buy at Raymond James; PT $39
• Airbnb (ABNB) Raised to Outperform at Oppenheimer; PT $180
• Amazon (AMZN) Raised to Buy at Fubon; PT $320
• Badger Infrastructure Solutions Ltd (BDGI CN) Raised to Buy at Canaccord
• Casella Waste (CWST) Raised to Overweight at Barclays; PT $102
• Celcuity (CELC) Raised to Buy at HC Wainwright; PT $165
• Diana Shipping (DSX) Raised to Buy at Arctic Securities; PT $3.80
• Essex Property (ESS) Raised to Overweight at Piper Sandler; PT $310
• GlobalFoundries (GFS) Raised to Overweight at Cantor; PT $80
• International Paper (IP) Raised to Overweight at Wells Fargo; PT $39
• KE Holdings (2423 HK) ADRs Raised to Buy at Goldman; PT $21
• O-I Glass (OI) Raised to Overweight at Wells Fargo; PT $13
• Packaging Corp. (PKG) Raised to Buy at Deutsche Bank; PT $256
• RenaissanceRe (RNR) Raised to Overweight at Cantor; PT $340
• Seanergy Maritime Holdings (SHIP) Raised to Buy at Arctic Securities
• SiteOne Landscape (SITE) Raised to Buy at Stifel; PT $157
• Star Bulk (SBLK) Raised to Buy at Arctic Securities; PT $36.50
• TD Bank (TD CN) Raised to Sector Outperform at Scotiabank; PT C$150
• Trade Desk (TTD) Raised to Neutral at Wedbush; PT $23
• Downgrades
• Alexandria Real Estate (ARE) Cut to Neutral at Baird; PT $46
• AMD (AMD) Cut to Hold at HSBC; PT $340
• Arizona Metals (AMC CN) Cut to Hold at Stifel Canada
• Check Point Software (CHKP) Cut to Neutral at BofA; PT $120
• Esperion Therapeutics (ESPR) Cut to Hold at Jefferies; PT $3.28
• Cut to Neutral at Piper Sandler; PT $3.16
• Guanajuato Silver (GSVR CN) Cut to Hold at Research Capital
• Palantir (PLTR) Cut to Hold at HSBC; PT $151
• Prudential Financial (PRU) Cut to Underweight at Morgan Stanley
• Safehold Inc (SAFE) Cut to Sector Perform at RBC; PT $16
• Sanofi (SAN FP) ADRs Cut to Equal-Weight at Morgan Stanley; PT $52
• Vital Farms (VITL) Cut to Neutral at DA Davidson; PT $16
• Initiations
• BeOne Medicines (6160 HK) ADRs Rated New Overweight at Wells Fargo
• Bimergen Energy (BESS) Rated New Buy at ThinkEquity; PT $10
• Compass Pathways (CMPS) ADRs Rated New Buy at Jefferies; PT $18
• Fannie Mae (FNMA) Rated New Outperform at Mizuho Securities; PT $10
• First Tracks Biotherapeutics (TRAX) US Rated New Overweight at Piper Sandler; PT $54
• FirstService (FSV CN) Rated New Hold at Loop Capital; PT C$190.41
• Freddie Mac (FMCC) Rated New Outperform at Mizuho Securities; PT $9
• HeartFlow (HTFL) Rated New Outperform at William Blair
• Hemlo Mining Corp (HMMC CN) Rated New Buy at TD Cowen; PT C$9
• MapLight Therapeutics (MPLT) Rated New Buy at HC Wainwright; PT $45
• Nuveen S&P 500 Dynamic Overwrite Fund (SPXX) Rated New Buy at Stifel
• Postal Realty (PSTL) Rated New Sector Outperform at Scotiabank; PT $23
• Quoin Pharmaceuticals (QNRX) US Rated New Buy at Lucid Capital Markets; PT $30
• Seer (SEER) Rated New Buy at Canaccord; PT $4
• Suncrete (RMIX) Rated New Outperform at William Blair
• Tonix Pharma (TNXP) Rated New Buy at TD Cowen; PT $22

Data sources: Bloomberg, Reuters, CQG

David Wienke