Daily Game Plan

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

TODAY’S ECONOMIC DATA:  8:30ET Housing Starts, Building Permits, Import Price Index, Export Price Index, New York
Fed Services Business Activity; Industrial Production, Capacity Utilization; Mfg Production; 1:00ET
Nvidia Chief Executive Jensen Huang will kick off the company’s GTC conference; 20-Year Bond Auction

Highlights and News:  

• Putin is Said to Want All Arms to Ukraine Halted in Trump Truce
• Israel Ends Gaza Ceasefire, Launches Strikes; Says Will Act With Increasing Intensity Against Hamas
• BofA Survey Shows Biggest-Ever Drop in Exposure to US Equities
• BYD Shares Hit Record on 5-Minute EV Charging
  
• Two NASA astronauts stuck in orbit for nine months will splash down around 6pm EST

World stocks rose on cautious optimism ahead of a key parliamentary vote that’s expected to open the door for Europe’s largest economy to spend hundreds of billions
of euros in defense and infrastructure. Global investors are hunting for opportunities outside of the US stock market. Investors slashed exposure to US equities by the most on record in recent weeks as expectations of global economic growth worsened, according
to BofA’s global fund manager survey. US equity allocation fell 40 percentage points from a month ago to investors being net 23% underweight. Israeli airstrikes pounded Gaza after prime minister Netanyahu directed the military to take “strong action” against
Hamas in response to the group’s refusal to release the remaining hostages and their rejection of ceasefire proposals. Investors will also be on a lookout for any breakthroughs during a call between US President Trump and Russian President Putin today about
a ceasefire in Ukraine.  

EQUITIES:  

US equity futures pull back following two days of gains as investors concerned about economic slowdown looked to the Federal Reserve’s policy meeting for insight. Geopolitics weigh after
Israeli airstrikes on Gaza escalated tensions in the Middle East. Putin’s call with Trump will also be in focus this morning. Attention is now turning to the Fed’s two-day policy meeting, which kicks off today, with the focus on what the central bank has to
say about those tariff risks to the economy. Policymakers are largely expected to hold rates steady in their decision on Wednesday. Alphabet is said to be in talks to buy cybersecurity firm Wiz for $33 billion, restarting discussions called off last year.
Nvidia investors are focused on chief executive Jensen Huang’s much-anticipated keynote speech at the GPU Technology Conference mid-day.

Futures ahead of the bell: E-Mini S&P -0.25%, Nasdaq -0.5%, Russell 2000 -0.6%, DJI -0.2%.

In pre-market trading, Harrow (HROW) soars 20% after the eyecare-pharmaceutical company posted preliminary 4Q revenue that topped expectations. Bakkt Holdings (BKKT)
sinks 31% after the company said two major partners would not renew their commercial agreements. Grab Holdings’ (GRAB) US-listed shares jump 5% as the firm is said to be moving forward with its attempt to take over its Indonesian rival GoTo Group. Lucid Group
(LCID) gains 2% after Morgan Stanley upgraded its rating on the electric-vehicle maker. Nio (NIO) climbs 5% after the Chinese EV company received an investment from battery giant CATL, while Li Auto (LI) gains 5% following a presentation at Nvidia’s annual
AI conference. PepsiCo (PEP) slips 1% after Barclays issued a downgrade.

European gauges rise ahead of a German parliamentary vote that is expected to sign off on a spending program worth hundreds of billions of euros. Germany’s ZEW expectations
gauge jumped to 51.6 in March, from 26.0 in the previous month, and above estimates. Germany’s DAX outperforms, touching a new record high before the landmark vote that should usher in more expansive fiscal policy and boost economic growth across Europe. European
defense stocks gained, with Thyssenkrupp AG rising over 6%, extending recent gains. Auto stocks also climbed, lifted by optimism around the outlook for electric vehicles after China’s BYD Co. unveiled rapid-charging EV models. Computacenter shares jump as
much as 13% after the IT company confirmed revenue returned to growth in the second half of 2024. Trustpilot shares rose as much as 16% after the user-review site reported a beat. Stoxx 600 +0.75%, DAX +1.25%, CAC +0.6%, FTSE 100 +0.3%. Banks +1.8%, Autos
+1.6%, Technology +1.6%, Energy +1.3%. Media -0.6%, Personal Goods -0.5%.   

Shares in Asia rose as rallies extended in Hong Kong and Japan, while Indonesian equities tumbled on economic woes. The MSCI Asia Pacific Index gained 1%, with major
Chinese technology names leading gains. Chinese stocks listed in Hong Kong outperformed, helped by a 12% rally in Baidu after it released a new AI model. BYD shares jumped to a record in China after it announced five-minute EV charging technology. Japanese
stocks rose after Warren Buffett’s Berkshire Hathaway increased its stakes in five trading houses. Indonesia’s benchmark plunged as concerns mounted over weakening consumer spending and President Subianto’s populist measures. The Jakarta Composite Index slid
as much as 7.1%, the most since September 2011. Investors will be taking further cues from a raft of earnings in China, with Xiaomi due to report later Tuesday, followed by Tencent and Meituan later this week. Hang Seng Tech +~4%, Hang Seng Index +2.5%, Sensex
+1.5%, Topix +1.3%, Singapore +0.9%, Taiwan +0.7%, Thailand +0.5%, CSI 300 +0.3%, ASX 200 +0.1%, Kospi +0.05%. Philippines -0.3%, Vietnam -0.4%, Indonesia -3.8%.

FIXED INCOME: 
 

Treasuries are mixed with the curve steeper, unwinding a portion of Monday’s sharp twist-flattening move. US front-end yields are richer by around 1bp, long-end cheaper
by 2bp-3bp, steepening 2s10s and 5s30s spreads by 3bp-2bp; 10-year around 4.315% is ~1.5bp cheaper on the day.  US session includes economic data and 20-year bond auction, contributing to steepening pressure.

METALS: 

Gold rose to a record high above $3,028 an ounce, bolstered by its safe-haven status amid rising tensions in the Middle East. Bullion climbed as much as 0.9% as Israel
launched military strikes on Hamas targets in Gaza, a move that threatens to undermine a shaky truce. The metal is up 15% so far this year.  Spot gold +0.8%, Silver +0.5%, Copper +0.1%.

ENERGY:   

Oil prices rose more than 1%, supported by instability in the Middle East and China’s plans for more economic stimulus. President Trump pledged to continue the US
assault on Yemen’s Houthis unless they end their attacks on ships in the Red Sea. Meanwhile, Israeli airstrikes hammered Gaza, resulting in over 400 deaths, according to Palestinian health officials, threatening the complete collapse of a two-month ceasefire
as Israel vowed to use more force to secure the release of hostages held by Hamas. Talks today between Trump and Putin about ending the Ukraine war are also in focus. Trump said he’s authorizing his administration to immediately begin producing energy with
coal in a bid to counter China’s economic advantage from the fossil fuel.  WTI 1.2%, Brent +1.1%, US Nat Gas -0.8%, RBOB +1.1%.

CURRENCIES: 

In currency markets, the euro firmed to a new five-month high versus the dollar before paring gains, as traders expect German lawmakers to pass later today a debt-financed
spending bill. Fading US growth outlook keeps the dollar muted. Scandinavian currencies lead gains, supported by higher European stocks. The yen fell as investors positioned for a possible dovish Bank of Japan monetary policy decision on Wednesday. US$ Index
+0.05%, GBPUSD -0.1%, EURUSD -0.05%, USDJPY +0.35%, AUDUSD -0.3%, NZDUSD -0.1%, USDCHF -0.1%, USDCAD +0.02%, USDNOK +0.1%.

Bitcoin -1.6%, Ethereum -2.2%.

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
• Block (XYZ) Raised to Outperform at KBW; PT $80
• CNX Resources (CNX) Raised to Overweight at Stephens; PT $48
• Duolingo (DUOL) Raised to Market Outperform at Citizens; PT $400
• EQT Corp (EQT) Raised to Overweight at Stephens; PT $59
• Expand Energy (EXE) Raised to Overweight at Stephens; PT $123
• GDS Holdings (GDS) ADRs Raised to Buy at Jefferies; PT $45
• Lucid (LCID) Raised to Equal-Weight at Morgan Stanley; PT $3
• Paccar (PCAR) Raised to Buy at Melius; PT $120
• Ralph Lauren (RL) Raised to Buy at Goldman; PT $286
• Sana Biotech (SANA) Raised to Market Outperform at Citizens; PT $5
• Sibanye Stillwater (SSW SJ) ADRs Raised to Outperform at RBC; PT $5.30
• Willis Towers (WTW) Raised to Buy at UBS; PT $395
• Downgrades
• Incyte (INCY) Cut to Neutral at Guggenheim
• Cut to Market Perform at William Blair
• Paccar (PCAR) Cut to Neutral at UBS; PT $108
• PepsiCo (PEP) Cut to Equal-Weight at Barclays
• TPI Composites (TPIC) Cut to Underperform at Jefferies; PT 50 cents
• Initiations
• Alpha Cognition (ACOG) Rated New Buy at HC Wainwright; PT $20
• Asur (ASURB MM) ADRs Reinstated Outperform at Grupo Santander; PT $298.64
• Bio-Techne (TECH) Rated New Outperform at Evercore ISI; PT $75
• Bloom Energy (BE) Rated New Neutral at Mizuho Securities; PT $28
• Blueprint Medicines (BPMC) Rated New Outperform at Wolfe; PT $132
• BWX Technologies (BWXT) Rated New Buy at President Capital Management
• Canaan (CAN) ADRs Rated New Buy at Compass Point; PT $2.50
• Coinbase (COIN) Rated New Outperform at Bernstein; PT $310
• GAP Airports (GAPB MM) ADRs Reinstated Neutral at Grupo Santander
• Genius Sports (GENI) Rated New Buy at Guggenheim; PT $12
• Reinstated Buy at B Riley; PT $12
• Global Business Travel Group (GBTG) Rated New Buy at BTIG; PT $10
• Hesai Group (HSAI) ADRs Rated New Buy at China Merchants; PT $25
• LENZ Therapeutics Inc (LENZ) Rated New Buy at TD Cowen; PT $60
• MoonLake Immunotherapeutics (MLTX) Rated New Outperform at RBC; PT $67
• Ocular Therapeutix (OCUL) Rated New Outperform at RBC; PT $17
• OMA (OMAB MM) ADRs Reinstated Outperform at Grupo Santander; PT $89.97
• Palvella Therapeutics In (PVLA) Rated New Buy at Lucid Capital Markets
• Priority Technology Hold (PRTHU) Rated New Buy at TD Cowen; PT $10
• Repligen (RGEN) Rated New Inline at Evercore ISI; PT $155
• Spyre Therapeutics Inc (SYRE) Rated New Outperform at Wolfe; PT $27
• Volaris (VOLARA MM) ADRs Reinstated Outperform at Grupo Santander; PT $9.79
• West Pharma (WST) Rated New Outperform at Evercore ISI; PT $275
• XP Inc. (XP) Rated New Outperform at Itau BBA; PT $20

Data sources: Bloomberg, Reuters, CQG

David Wienke