Tuesday, March 31

Stocks set to rise as Trump willing to end Iran war without Hormuz deal


The FTSE 100 (^FTSE) and European stocks are set to open higher on Tuesday morning following a Wall Street Journal report that Donald Trump has told his aides he was willing to end the US military campaign against Iran, even if the Strait of Hormuz remained largely closed.

The US president assessed that a mission to reopen the strait would push the war beyond his timeline of four to six weeks, according to the report, which cited administration officials.

Comments from US leadership have pointed to potential progress in diplomatic discussions, while Trump also claimed that the US may move to seize control of Iran’s oil.

The news has raised hopes that the current phase of the conflict will wind down soon, with West Texas Intermediate (CL=F) pulling back to trade near $103 a barrel after earlier jumping almost 4% following another Iranian attack on a tanker in the Persian Gulf. Meanwhile, Brent crude (BZ=F) was around $113.

It comes after Trump said on Monday that the US will blow up power plants, oil facilities and “possibly” desalination infrastructure if Iran doesn’t re-open Hormuz.

“This will be hurting the Trump administration,” Will Walker-Arnott of wealth manager Raymond James told BBC Radio 4’s Today programme.

“Markets continue to gyrate. The Trump administration continues to vacillate and so there is continued uncertainty in the markets.”

Looking ahead, investors are gearing up for fresh economic data on Tuesday, including the March reading on consumer confidence and February’s Job Openings and Labor Turnover Survey (JOLTS), both of which should provide insight into the health of the US economy.

  • London’s benchmark index (^FTSE) is set to open 0.2% higher

  • Germany’s DAX (^GDAXI) is set to rise 0.5% and the CAC (^FCHI) in Paris will head 0.6% into the green

  • The pan-European STOXX 600 (^STOXX) was up 0.3%

  • Contracts linked to the S&P 500 (ES=F) rose 0.8% as Nasdaq 100 (NQ=F) futures climbed 0.7%. Dow Jones Industrial Average (YM=F) futures leaped 0.9%.

  • The pound was 0.1% higher against the US dollar (GBPUSD=X) at 1.3196

Follow along for live updates throughout the day:

LIVE 3 updates

  • Asia and US overnight

    Stocks in Asia were down across the board last night, with the Nikkei (^N225) slipping 1.6% on the day in Japan, while the Hang Seng (^HSI) fell 0.4% in Hong Kong.

    The Shanghai Composite (000001.SS) was 0.7 down by the end of the session and in South Korea, the Kospi (^KS11) lost 4.3% on the day.

    It came despite a modest upside surprise in China’s official PMIs, with the manufacturing PMI at a one-year high of 50.4 (compared to the 50.1 expected), whilst the non-manufacturing PMI rose to 50.1, versus the forecasted 49.9.

    The negative mood was buoyed by Kuwait Petroleum Corp saying overnight that an oil tanker was attacked by Iran in a Dubai port, causing a fire, despite a Wall Street Journal report saying that president Trump told aides he was willing to end the US military campaign against Iran, even if the Strait of Hormuz remained largely closed.

    Across the pond on Wall Street, stocks were mixed at the close, with the S&P 500 (^GSPC) down 0.4%to 6,343.72, and the tech-heavy Nasdaq (^IXIC) was 0.7% lower at 20,794.64. The Dow Jones (^DJI) eked out a 0.1% gain, closing at 45,216.14.

  • UK shop price inflation edges up

    Shop price inflation edged up in March as higher costs resulting from the Middle East conflict started to feed into supply chains, figures show.

    Shop prices overall were 1.2% higher than a year ago, up from 1.1% in February but still below the three-month average of 1.3%, according to data from the British Retail Consortium (BRC) and NIQ.

    The BRC warned that “storm clouds loom” despite “subdued” inflation and noted the headline figure rose even as food inflation eased from 3.5% to 3.4% due to dairy prices falling with lower wholesale milk costs.

    Inflation on non-food items rose to 0.1% against a drop of 0.1% in February despite retailers offering promotions on alcohol, TVs and sound systems in the run-up to the final round of the Six Nations, as well as on clothing and footwear to entice consumers to spend.

    BRC chief executive Helen Dickinson said:

  • Coming up

    Good morning, and welcome back to our markets live blog. As usual we will be taking a deep dive into what’s moving markets, and what’s happening across our global economy.

    Looking at the day ahead now, and data releases include the Euro Area flash CPI print for March, German unemployment for March, the US Conference Board’s consumer confidence indicator for March, the JOLTS job openings for February, and the FHFA house price index for January.

    From central banks, we’ll hear from the Fed’s Goolsbee, Barr and Bowman, and the ECB’s Panetta, Muller, Kazimir and Sleijpen.

    Here’s a snapshot of what’s on the agenda for today:

    • 7am: Trading updates: Pets at Home, AG Barr, James Halstead, Hilton Food, Raspberry Pi, Princes Group

    • 10am: Eurozone inflation

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