Good morning and Happy Month/Quarter-End. US equity futures are trying for another rally this morning after gains quickly faded after the Open yesterday. The S&P 500 ended Monday down 0.4%. However 8/11 sectors were higher despite oil moving up again, as the selling pressure was concentrated on the AI ecosystem (Tech, Industrials, Energy all lower). Small caps were also hit as the Russell fell 1.5%, though the S&P 600 small cap index was down only half as much. Treasuries saw sharp gains, pushing yields down ~10bp across much of the curve. Financials led the sectors. For the month and quarter, the S&P 500 is looking at a 7% to 8% declines for both.

The main update on Iran came from a WSJ article that said President Trump was open to ending the war without reopening the Strait of Hormuz. That gave the market another potential off-ramp it’s been looking for. President Trump added his own comments earlier this morning, saying other countries that can’t get oil due to the Strait closure should buy it from the US or “take it”, which was taken as a confirmation of the WSJ article. Equity futures are trading higher, with the S&P near best levels. Treasuries continue to see a bid following yesterday’s gains, pushing yields down another 2-3bp across most of the curve, though the 2y is around flat. The Dollar is weaker against the major crosses, with the US Dollar Index trying to hold 100.

Brent crude is trading up >4%, at its highs of the day. Precious metals are higher as well, as is ag ahead of some USDA reports later today. Bitcoin and Ether are also seeing modest gains.