WS #7401
The dominant narrative remains the Strait of Hormuz closure and its inflationary shock, with oil prices resuming their upward march. The US Industrial Production MoM came in at 0.7% vs 0.3% forecast, reinforcing the 'higher-for-longer' rates thesis. Bitcoin dipped below $79,000 as inflation fears hit risk assets. The Conference Board sees prolonged inflation and the Fed holding steady. On the geopolitical front, China's Wang Yi called for reopening the Strait of Hormuz and confirmed US-China agreement to set up trade boards, but no concrete de-escalation on the Strait. Iran's Araghchi expressed doubt about US seriousness in talks. A major dark pool order of $742.4M in SPY and a bullish SPX call block of $437M suggest institutional positioning for a bounce, but the macro headwinds remain dominant. Bill Ackman disclosed a new stake in Microsoft, calling it 'compellingly cheap', providing a MAG7-specific bullish signal. The energy crisis continues to escalate with no counter-signal.
Key developments
- US Industrial Production MoM beats forecast (0.7% vs 0.3%)
- Bitcoin dips below $79,000 as inflation fears hit risk assets
- Bill Ackman's Pershing Square buys Microsoft, calls it 'compellingly cheap'
- China's Wang Yi calls for reopening Strait of Hormuz; US-China agree to set up trade boards
- BofA warns semiconductor stocks trade like 1720 Mississippi bubble
- Large dark pool SPY order ($742.4M) and bullish SPX call block ($437M) detected
- Iran's Araghchi: Iran doubts US 'seriousness' about talks; nuclear deadlock remains
- Conference Board sees prolonged inflation, Fed holding steady