Futures on Wall Street, that were in wait-and-watch mode ahead of US President Donald Trump’s address, have declined sharply after he did not share any timeline on an off-ramp for the ongoing war in Iran, but threatened further attacks over the next two to three weeks.
Futures on the Dow Jones are now down 480 points, while those on the S&P 500 and Nasdaq are down 80 points and 350 points as well.
Benchmark indices on Wall Street rose on Wednesday, April 1, as the relief rally continued on hopes of the Iran war ending soon, and ahead of US President Donald Trump’s address to the nation a few minutes from now.
The Dow Jones ended 220 points higher on Wednesday, gaining for the third day in a row, while the S&P 500 and the Nasdaq gained 0.7% and 1.2% respectively, adding a second day of recovery to their tally.
Oil Prices Reverse Losses
Markets rose on hopes that the Iran war will end soon, which led to oil prices dropping overnight. However, after Trump’s address, oil prices have staged a sharp reversal from the lows with Brent now trading close to $105 a barrel, while the US Crude futures are also back above $100 in early Asia trading.
The US Dollar index has also reversed its two-day drop and is heading back towards the 100 mark, while Gold and Silver prices dropped in-line with risk assets.
Positive Macro Data
Macro data reported on Thursday was generally positive, with private payrolls indicating an addition of 62,000 jobs in March, higher than the 40,000 estimate, as per ADP data, while retail sales for the month of February were ahead of expectations. Manufacturing for March rose to the highest since 2022, even as input price pressures also jumped to a four-year high.
Most Analysts Cautious
Both JPMorgan and Goldman Sachs believe that the two-day rally has more to do with unwinding of negative positions in the market than a shift in sentiment regarding the war, while UBS said that it remains confident of the market ending higher from where it currently is by the end of the year and that the two-day move shows how quickly the market can recover if there is a resolution to the war.
The markets will remain closed for Good Friday but despite the holiday, the much awaited March jobs report will still be released tomorrow evening at 6 PM IST.