Oil Sells Off as Iran Tensions Ease

Iran risk trades have reversed this morning after President Trump suggested overnight that the killing of protesters has stopped. With fears of escalation fading for the moment, the price of Crude Oil has dropped 4.1% and is back under $60.00/bbl. The fear trade in precious metals is reversing more moderately this morning with Gold down 0.4% and Silver down 0.5%. Copper is down 0.8%.

Equities, meanwhile, are on the rebound, reversing most of yesterday’s declines. NASDAQ futures, for example, are up 0.8%, nearly erasing yesterday’s 1.0% loss. Overseas, the FTSE is up 0.5%, the DAX is steady, the Hang Seng fell 0.3%, and the Nikkei fell 0.4%.

Positive results from Taiwan Semiconductor ($3.09 vs street $2.90) overnight have chipmakers rallying this morning, helping the NASDAQ. In the US today, earnings are focused on the investment banks where Goldman Sachs* ($14.01 vs Street $11.70) and Morgan Stanley* ($2.68 vs Street $2.43) handily beat expectations, along with wealth manager Blackrock ($13.16 vs street $12.24).  

In economic news, both the Empire State Manufacturing Index (7.7 vs Street 1.0%) and Philadelphia Fed Manufacturing Index (12.6 vs Street -2.0) came in well above expectations, indicating robust business conditions in the US.

*Shares of Goldman Sachs and Morgan Stanley are held in some portfolios managed by SIA Wealth Management.

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