The Overnight Report: Trump Update Anticipation

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US markets continue to rally, albeit they pared back gains over the last two hours of trade ahead of President Trump's adress to the US nation at 12pm (AEST) today.

Markets continue to hope for a speedy resolution to the Iranian conflict.

After a sharp rally on the Australian market yesterday, SPI futures are pointing to another positive start.

The market may swing depending on President Trump's adress or traders' positioning ahead of the long Easter weekend.

Good Morning,

The ASX200 rallied sharply on Wednesday on hopes of an end to the Middle East conflict.

The index rose 190 points to 8,672 with ten of eleven sectors rallying, led by miners, up 4.9%, and tech.

Utilities was the only sector decliner.

Today’s Big Picture, J.L. Berstein 

SpaceX Files for the Largest IPO in History

SpaceX confidentially filed with the SEC, putting it on track for a June or July listing. The company merged with xAI in February at a US$1.25tn valuation and could seek US$1.75trn at IPO. 

The raise could hit US$40bn to US$80bn, more than triple Alibaba’s US$22bn record from 2014.

Bank of America, Citi, Goldman, JPMorgan, and Morgan Stanley are leading. 

If this happens, Musk will be the first person running two separate trillion-dollar public companies. 

Intel Buys Back Ireland Fab from Apollo Intel

Intel is repurchasing the 49% stake in its Ireland chip factory that Apollo bought for US$11.2bn in 2024. 

Price tag: US$14.2bn, a 27% premium for Apollo in under two years. Intel is funding it with cash and US$6.5bn in new bonds. 

They could not have issued this debt in 2024 without risking a credit downgrade.

The fact that they can now tells you the turnaround is real. 

Markets Ignore Iranian Hardliners

Stocks rose again as Trump promised a military exit in two to three weeks.

But Iran’s parliament said today the Strait of Hormuz “will not open” and they have held zero negotiations.

This disconnect between Washington’s optimism and Tehran’s rhetoric makes me very cautious holding these gains overnight.

Trump addresses the nation at 9 PM ET.

NAB Markets Today Research extract

Iran developments remain in focus and equity and currency markets have tended to extend yesterday’s moves. 

President Trump is due to give an address with an “important update” at midday Sydney time but there is no shortage of uncertainty remaining. The NY times reports the Pentagon is doubling its fleet of A-10 attack planes in Middle East.

Trump yesterday claimed “Iran’s new regime president” had asked for a cease-fire, a claim Iran called “false and baseless.”

Again highlighting the possibility of some passage, but not a return to free navigation, the head of Iran’s parliamentary national security committee said access to the Persian Gulf would be subject to new conditions set by Iran: “The Strait of Hormuz will certainly be opened; but not for you!”

Separately, the WSJ reported the United Arab Emirates is preparing to help the U.S. and other allies open the strait by force, and is pushing for a UN Security Council resolution to authorise the move.

US data surprised to the upside. ISM manufacturing rose to 52.7 in March, the strongest reading since 2022. The rise was helped by a jump in supplier delivery times.

The production index was higher and employment was little changed. Prices paid climbed to 78.3. Separately, retail sales rebounded more than forecast in February. ADP private payrolls rose 62K in March, above expectations for 40k.

Payrolls data are released tomorrow, where expectations are for up 75k and the unemployment rate steady at 4.4%.

The US data saw the move lower in yields retrace. US 10-year yields briefly dipped to 4.26% before retracing to around 4.33%. Yields were lower in Europe, with 10yr bund yields -2bp lower and gilt yields -9bp lower.

Federal Reserve Bank of St. Louis President Alberto Musalem said the current policy rate will likely remain appropriate for some time, noting that risks are rising to both inflation and employment.

Yesterday’s Japan Q1 Tankan showed current conditions reasonably solid and a fifth consecutive survey rise in expected (5-year) inflation, now to 2.5%. The result follows indications from last week’s first round of Rengo wage negotiations that point to wage rises topping 5% for a third year.

NAB now expects the BoJ to lift rates by 25bps on April 28 (previously mid-year). In H2 we would then expect one further rise, taking the policy balance rate to 1.25%, within the realms of the BoJ’s estimate of nominal neutral (1.1% to 2.5%). Markets price 16bp of tightening in April and 25bp by June.

In FX markets, the US dollar extended yesterday’s decline, down another -0.3% on the DXY. The AUD was 0.3% higher at around 0.6921, having pared back from in intraday high of 0.6959 alongside a fallback in US equities from their intraday highs.

Equity markets are stronger. The S&P500 closed up 0.72% higher following a 2.4% gain yesterday, and the Nasdaq 1.16% stronger after a 3.4% gain yesterday.

European indices are also higher, and the Nikkei surged 5.2% and the Korean benchmark jumped 8%, catching up to the strong improvement in risk appetite that drove US equities higher the prior day.

In commodities, oil prices slid further. Brent was -3.0% lower at US$100.9, having dipped below US$100 intraday. WTI was -2% lower at US$99.54, having been down almost -5% at one point.

Aluminium prices were another 2% higher. Emirates Global Aluminium, the Middle East’s top producer of the metal, halted operations at its Al Taweelah smelter after the site was struck by Iranian missiles and drones over the weekend.

Gold gained 2.2%.

Credit markets also reflected the more positive risk tone.

Gold’s Lazarus Rally: Bullion Reclaims US$4700 as Middle East Tensions Thaw, extract, Tony Sycamore, IG 

After signing off on its worst month since October 2008, a brutal stretch that saw the precious metal finish -11.57% lower, gold has extended its Lazarus-like recovery, popping back above the US$4700 handle.

At US$4723, bullion has rebounded an impressive US$625 or 15.2% from the US$4098 low it struck just nine days ago.

This rebound has extended as rising hopes of de-escalation in the Iran conflict improve the broader macro backdrop. A softer US dollar, falling Treasury yields, and declining energy prices have all combined to provide a gentle tailwind for the yellow metal.

President Trump’s latest comments on ending the conflict appear to be his most definitive yet. He noted the US will be leaving Iran “very soon,” with the White House flagging an “important announcement” slated for 9:00 p.m. EDT on Wednesday (midday Thursday, Sydney time).

The latest de-escalation arrives as Trump faces falling approval ratings tied directly to US retail gasoline prices pushing above US$4.00 a gallon, a sticky political predicament ahead of the November midterms.

The administration effectively faces a binary choice: attempt to forcibly reopen the Strait of Hormuz, risking the lives of US servicemen and major damage to global energy infrastructure, or opt for a cleaner resolution.

The latter means leaving the current regime in place, limiting energy infrastructure damage, and allowing oil prices to stabilise or fall if Iran reopens the Strait once its primary antagonist departs.

As a quick side note, while a swift exit would undoubtedly be sold as a victory back home and greeted with immense relief by markets, it remains to be seen how the US’s Gulf state allies, who would be left highly exposed, will react to a tactical retreat.

Returning to gold, it is worth remembering an end to the conflict could prove a double-edged sword. On one hand, a lasting peace agreement would remove the geopolitical safe haven bid that supported prices in the run-up to the conflict.

On the other hand, it would allow for lower oil prices and easing inflation fears, which would revive expectations for Federal Reserve rate cuts later in 2026. This dynamic, combined with the underlying structural demand from central banks who have been accumulating gold for diversification, means we could still see upside.

However, given these cross-currents, the loss of immediate safe-haven premium balanced by renewed rate cut hopes and persistent central bank buying, we’re likely looking for more of a slow grind higher rather than a quick-fire rally from here.

Gold Technicals

After holding a bearish view of gold throughout much of March, a conviction that only strengthened following its decisive break below US$5000, we officially flipped to a bullish bias early last week.

This shift occurred once gold successfully tested and bounced firmly from our critical US$4200/US$4100 support zone.

Providing gold continues to hold firmly above this key support band at US$4130/uS$4100, we will maintain our expectation for a grind higher, initially targeting a return towards the US$5000 level.

A decisive break above US$5000 would then open the door for a retest of the US$5602/oz record high.

Relief Rally Ends Correction Risk, Yardeni Quicktakes extract

Yesterday’s powerful relief rally in the stock market was fueled by news that President Donald Trump intends to declare victory in the war with Iran, according to an article in this morning’s Wall Street Journal.

Around noon, the market moved higher still on a report that the President of Iran said his country is ready to end the war if the US agrees to its 5-point peace plan.

Then, after the market closed, around 6:30 pm EST, Trump told reporters that the US would be leaving the war zone in 2-3 weeks. His press secretary announced that the President will deliver a formal Address to the Nation Wednesday night at 9:00 pm.

He certainly won’t be accepting the Iranian plan, and he seems ready to withdraw without Iran accepting his 15-point plan, which includes opening the Strait of Hormuz.

If Trump is declaring mission accomplished, then so are we regarding our stock market correction call.

We will probably lower our recession odds from 35% back to 20% once we have a better handle on whether the conflict in the Persian Gulf is actually over.

We reserve the right to change our minds as often as the President does. Nevertheless, we have maintained our 7700 S&P 500 year-end target and our commitment to our Roaring 2020s base case.

The S&P 500 jumped 2.91% yesterday, and the Nasdaq soared 3.82% . The former experienced a -9.1% pullback from its January 27 record high, while the latter fell -13.2% from its October 29, 2025 record high. The significant valuation-led sell-offs in both were moderated by the ongoing strength in corporate earnings expectations, as we’ve frequently observed.

Our favorite Bull/Bear Ratio dropped to 1.12 this week, down from 1.57 the previous week. As we’ve noted before, such bearish sentiment readings are bullish from a contrarian perspective. So much pessimism usually instigates a surprisingly bullish government policy response and an unexpected rebound in stocks, as we saw today.

If the war is almost over, then the damage to the US economy is likely to be minor. The latest batch of economic indicators provides a snapshot of the economy’s starting point heading into the negative energy price shock and offers early signals on how the shock may be transmitting through the economy.

We continue to believe the current war in the Middle East is yet another test of the resilience of the economy, corporate earnings, and the stock market.

We expect they will pass this latest test. So far, so good.

US Stock Indices Rally Smells Like A Dead Cat Bounce, MarketPulse extract

Rally likely a “dead cat bounce”: The sharp surge across US indices appears driven by short-covering and quarter-end positioning amid optimism over a potential US-Iran de-escalation, rather than a sustainable bullish reversal.

Macro and technical backdrop still bearish: Longer-term charts show bearish reversal patterns across major indices, signalling deterioration in the broader uptrend despite the recent rebound.

Weak breadth and key resistance levels cap upside: Market breadth remains fragile with limited participation, while indices are still below critical resistance levels (S&P500 – 6,730), (Nasdaq100 – 24,355), (DJIA – 47,460), leaving downside risks intact unless these levels are decisively reclaimed.

Corporate news in Australia

-Eagers Automotive ((APE)) entered agreements to acquire two Audi dealers in Melbourne, and a 49% interest in Grand Motors Group

-Calvary Health Care and Pacific Equity Partners bid $400m for Healthscope

-Nelson Peltz acquires Janus Henderson for US$8bn and aims to boost performance with AI

-Australia backs Arafura Rare Earths ((ARU)) with $1.2B to fund Nolans project

-TPG NewQuest funds Pemba’s Vets Central continuation vehicle, retaining Pemba and adding new capital

-Atlassian faces claims of denying shares to laid-off staff

-Former Toll executive supports Graphite Energy following $15m raise to expand electric boiler production

-Optus lifts mobile plans by $5, second increase within a year raising regulatory concerns

On the calendar today:

-AU Feb-end Qtr Job Vacancies

-US Feb Trade Balance

-US March Weekly Jobless Claims

FNArena’s four-weekly calendar: https://fnarena.com/index.php/financial-news/calendar/

The Australian share market over the past thirty days…

For more detail go to FNArena’s Australian Broker Call Report, which is updated each morning, Mon-Fri.

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