Daily Game Plan

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

TODAY’S ECONOMIC DATA:  8:30ET PPI, 9:45ET Bank of Canada Rate Decision; 10:00ET Factory Orders, Durable Goods Orders,
Cap Goods Orders; 2:00ET FOMC Rate Decision; 2:30ET Fed Chair Powell Press Conference

Highlights and News:  

• Israel’s Katz Says Iran Intel Minister Killed; Significant Surprises Expected Today in All Arenas
• IRAQ STARTS KIRKUK OIL EXPORTS VIA TURKEY CEYHAN PIPELINE
• JAPAN, US TO ANNOUNCE 2ND ROUND OF INVESTMENTS AT SUMMIT
• US to Ease Venezuela Sanctions to Unlock More Oil Amid Iran War
  
• Iran is maintaining near pre-war crude flows through Hormuz, according to Kpler
• Iranian Parliament Speaker says “victory is near”
  
• Venezuela won the World Baseball Classic for the first time
  
• US FEB. PRODUCER PRICES RISE 3.4% Y/Y; EST. +3.0%

Global stocks rally as oil prices ease, buoyed by Iraq’s agreement to resume crude exports through Turkey—rerouting shipments via pipeline to the Ceyhan port and
sidestepping the disrupted Strait of Hormuz. Investors await the Federal Reserve meeting later in the day, where the Fed is expected to hold its benchmark interest rate steady.  Japan’s Prime Minister Takaichi described her upcoming Thursday meeting with President
Trump as “extremely difficult,” following his sharp criticism of Tokyo for rejecting his push for Japan to deploy warships to safeguard the Strait of Hormuz. Iranian attacks on Israel and Arab states in the Persian Gulf continued overnight, while Trump said
the US could end the war with the Islamic Republic “in the near future.” The attacks followed Iran confirming the assassination of its security chief, Ali Larijani, in an Israeli strike.

EQUITIES: 

US equity futures were broadly higher, a day after the S&P500 posted its first back-to-back gain since the start of the Iranian war as investors zero in on energy costs ahead of the Federal
Reserve’s upcoming interest rate decision. Futures turn into the red after PPI data disappoints. Mag 7 stocks were higher in pre-market trading after Nvidia’s CEO said the $1 trillion projection he had previously issued for AI chip sales doesn’t capture
other product offerings and signaled that total revenue will surpass that level. The next blackout period for corporate buybacks is due to start today with an estimated 45% of all S&P 500 firms expected to halt their share repurchases by that point, according
to Goldman Sachs. Micron reports after the close

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

In pre-market trading, Applied Optoelectronics (AAOI +9.4%), Lumentum (LITE +7.2%) and Coherent (COHR +4.2%) rally after the companies announced updates and spoke about
optical demand at the Optical Fiber Communications Conference in Los Angeles. CF Industries (CF) falls 4.3% after Mizuho Securities cut its recommendation on the fertilizer company to underperform from neutral. Constellation Brands (STZ) is up 2.8% after Citi
raised the recommendation on the beverage company to buy from neutral, citing a beer topline acceleration and a valuation that’s below historical levels. Coupang (CPNG) is up 2.6% after the company said that its collaboration with Nvidia helped it build an
AI platform that will support the firm’s e-commerce logistics and delivery services. Duolingo Inc. (DUOL) falls 1.3% after Argus Research downgraded the language learning software company to hold from buy. Grail Inc. (GRAL) rises 4.5% after TD Cowen upgraded
the life sciences company to buy from hold, saying the recent selloff creates an “attractive entry.” SL Green (SLG) is up 2.7% after Deutsche Bank upgraded the office REIT to buy from hold. Swarmer Inc. (SWMR) jumps 35%, set to extend gains after the artificial
intelligence drone software company notched the best trading debut for a US stock in nearly a year. T1 Energy (TE) is up 3.9% after the solar equipment maker said it secured 50 MW of grid power in Norway for a data center. The Trade Desk shares (TTD) are down
4.6% after Adweek said Publicis was telling clients to avoid working with the advertising technology firm.

European gauges look for a third day, which would be the longest run since the Iran war began. Banks and industrials lead gains in Europe, while the food and beverage
sector is the biggest laggard. Among individual names, Diploma shares rally 18% to their highest intraday level on record after the building components supplier boosted its organic revenue forecast for the full year. Bollore shares rose as much as 16% after
the French conglomerate announced an exceptional dividend payment. Softcat gains as much as 9.9% as first-half results prove much better than analysts expected. Logitech shares drop as much as 5.9% after UBS downgrades the Swiss maker of computer peripherals.
HelloFresh shares drop as much as 15% to a record low after the meal-kit company’s guidance for this year’s sales and profits came in well below analyst expectations.
Gauges slide from their earlier highs after US PPI figures. Stoxx 600 -0.1%, DAX -0.05%, CAC +0.4%, FTSE 100 -0.1%.  Banks +1.5%, Defense +1.2%. Food & Bev -2%, Telecom -1.4%.

Shares in Asia were broadly higher, led by South Korea, as a slight easing in oil prices buoyed a risk-on sentiment. The MSCI Asia Pacific Index gained 2%, adding to
Tuesday’s nearly 1% gain. Shares of chip giants TSMC, Samsung and SK Hynix were the biggest contributors to the advance. Korea’s benchmark jumped 5% as authorities announced more measures to enhance shareholder value. AI remains in focus, with shares of Asian
memory chipmakers extending their rally after Reuters reported Amazon’s CEO seeing
⁠AWS reaching $600 billion in annual sales, double
his own prior estimate. Samsung Electronics is weighing longer-term, multi-year deals for memory products to address supply dynamics. Tencent Holdings posted a 13% rise in quarterly revenue, underscoring solid momentum in its core gaming and advertising units.
Chinese data center service and component providers jumped, as both Alibaba and Baidu plan to raise prices for its computing and storage products. Alibaba is raising prices for its AI computing and storage products by as much as 34%. Chinese shares related
to OpenClaw jumped, buoyed by bullish comments from Nvidia’s CEO on the potential of artificial intelligence agents. Kospi +5%, Nikkei 225 +2.9%, Taiwan +1.5%, Singapore +1.3%, Sensex +0.8%, CSI 300 +0.5%, ASX 200 +0.3%, Vietnam +0.2%.

FIXED INCOME: 
 

Treasuries are mixed with gains led by intermediates, flattening 2s10s spread by 2.5bps and adding to Tuesday’s tightening move. The 2s10s curve now at around 50.0bp
trades just inside the yearly lows at 49.6bp reached March 12. US 10-year yields trade around 4.19%.  Bond traders are unwinding bets that drove markets to price out Fed rate cuts this year. The central bank is expected to hold rates steady for a second straight
meeting today and Jerome Powell’s comments on the risks to the economy from the Iran conflict will be in the spotlight.

METALS: 

Gold slides to the lowest in a month as investors assessed the possibility of a more hawkish turn from the US Federal Reserve, while persistently elevated oil prices
stoked fresh worries about a resurgence in inflationary pressures. The energy-supply crunch and higher crude prices have raised concerns over inflation and reduced the prospect for near-term rate cuts by the Fed and other central banks. While the Fed is expected
to keep rates unchanged at its policy meeting later today, investors will scrutinize the central bank’s views on rising energy prices and a cooling labor market. Spot gold ~2%, Silver -1.5%, Copper futures -1.1%. 

ENERGY:   

Oil prices slipped as Iraq’s pipeline deal with Turkey to export crude while avoiding the Strait of Hormuz reduces supply jitters. Iraq is set to restart crude exports
via the pipeline connecting its semi-autonomous Kurdistan Region to Turkey’s Mediterranean port of Ceyhan. However, this northern route can handle only a limited portion of the OPEC member’s total output, which has plummeted to roughly one-third of pre-war
levels. Prices recovered some losses as traders monitor bypass efforts, with most of the Persian Gulf’s supplies still blocked, and Iran allowing only a handful of vessels to transit. Meanwhile, the Trump administration intends to take additional steps to
ease sanctions on Venezuela’s oil sector to increase crude production. Brent erased its earlier fall with futures now higher on the day and back above $104 a barrel, after Iran vowed revenge for attacks that led to the death of its security chief Ali
Larijani. Iranian state TV said part of the giant South Pars gas field was hit in an airstrike.  WTI -0.9%, Brent +1.3%, US Nat Gas -2.1%, RBOB
+0.8%.

CURRENCIES: 

In currency markets, US$ is little changed and stayed in tight ranges versus major peers as investors awaited the Federal Reserve’s interest-rate decision. The Bank
of Canada is also likely to hold interest rates steady today as policymakers weigh the inflation risk of higher oil prices against a string of weak economic numbers. The dollar is back as a stock-market hedge, hitting its strongest inverse correlation with
US equities in nearly a year. Japan’s prime minister is due to depart today for her meeting with Trump. Takaichi is likely to discuss a second round of Japanese investment in the US as part of tariff deals. Japan’s public broadcaster NHK reported that the
two countries are preparing to issue a joint statement committing to investments of up to 11 trillion yen (approximately $69.3 billion). US$ Index -0.05%, GBPUSD -0.05%, EURUSD -0.05%, USDJPY +0.05%, AUDUSD -0.3%, NZDUSD -0.3%, USDCHF -0.25%, USDCAD +0.05%,
USDSEK +0.5%, USDNOK +0.15%.

Spot Bitcoin -2.5%, Spot Ethereum -3%.  Chinese crypto giant Bitmain struck a partnership with Eric Trump’s American Bitcoin.

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 Buy at Truist Secs; PT $77
• Raised to Neutral at Rothschild & Co Redburn; PT $55
• Constellation Brands (STZ) Raised to Buy at Citi; PT $175
• CubeSmart (CUBE) Raised to Outperform at BNP Paribas; PT $43
• DHT Holdings (DHT) Raised to Buy at Pekao Investment Banking
• Grail (GRAL) Raised to Buy at TD Cowen; PT $65
• Knight-Swift (KNX) Raised to Buy at UBS; PT $66
• Lensar (LNSR) Raised to Buy at BTIG; PT $10
• LyondellBasell (LYB) Raised to Neutral at UBS; PT $73
• ManpowerGroup (MAN) Raised to Neutral at Goldman; PT $30
• Netflix (NFLX) Raised to Buy at Citi; PT $115
• SL Green (SLG) Raised to Buy at Deutsche Bank; PT $44
• Downgrades
• Aldeyra (ALDX) Cut to Neutral at HC Wainwright; PT $2
• CF Industries (CF) Cut to Underperform at Mizuho Securities; PT $100
• Gemini Space Station (GEMI) Cut to Sell at Citi; PT $5.50
• Health Catalyst (HCAT) Cut to Equal-Weight at Wells Fargo; PT $1
• Pinterest (PINS) Cut to Neutral at President Capital Management; PT $21
• Starbucks (SBUX) Cut to Sector Perform at RBC
• Tencent Music (TME) ADRs Cut to Hold at Benchmark
• ADRs Cut to Neutral at JPMorgan; PT $12
• Trade Desk (TTD) Cut to Hold at Stifel
• Initiations
• AGI (AGBK) Rated New Outperform at Bradesco BBI; PT $16
• Apogee Therapeutics (APGE) Rated New Hold at Truist Secs; PT $83
• Arcturus Therapeutics (ARCT) Reinstated Buy at B Riley; PT $22
• Climb Bio Inc (CLYM) Rated New Buy at Truist Secs; PT $17
• Constellation Energy (CEG) Rated New Outperform at BNP Paribas
• Doximity (DOCS) Rated New Buy at Freedom Capital; PT $31
• Evommune (EVMN) Rated New Buy at Clear Street; PT $53
• Maze Therapeutics (MAZE) Rated New Buy at Truist Secs; PT $68
• NRG Energy (NRG) Rated New Outperform at BNP Paribas; PT $232
• Pony AI (PONY) ADRs Rated New Buy at Industrial Securities
• Sandisk (SNDK) Rated New Outperform at KGI Securities; PT $992
• Sixth Street Specialty Lending (TSLX) US Rated New Buy at Lucid Capital Markets; PT $21
• Stack Capital Group (STCK CN) Rated New Buy at Ventum Financial; PT C$23
• Talen Energy (TLN) Rated New Outperform at BNP Paribas; PT $548
• Weatherford (WFRD) Rated New Outperform at RBC; PT $105
• XCF Global (SAFX) Rated New Neutral at Roth Capital Partners

Data sources: Bloomberg, Reuters, CQG

David Wienke