Morning Bid: Finding the 'off ramp'

• The relief rally extended to bonds, credit, and gold, which had been beaten down during the conflict, though missile and drone exchanges in the Gulf continue
• U.S. consumer confidence showed an upside surprise in March despite the energy shock, while job openings data and corporate earnings growth estimates remain relatively unchanged
• Asian factory activity expanded amid rising fuel costs, with South Korea's activity rising at the strongest pace in over four years driven by AI-related semiconductor demand

Market Summary: Relief Rally on Iran De-escalation Signals

Key Market Developments:

U.S. markets surged on April 1st as diplomatic signals suggested a potential "off ramp" from the Iran conflict. The S&P 500 jumped nearly 3%—its largest single-day gain since May of the previous year—driven by statements from President Trump and the Secretary of State indicating willingness to de-escalate tensions. Iranian President Masoud Pezeshkian reportedly expressed openness to ceasefire discussions.

Commodity Markets:

Brent crude traded around $103 per barrel while WTI hovered near $100, having dipped below that threshold earlier. Oil prices remain elevated despite the diplomatic progress, as missile and drone exchanges continue in the Gulf region.

Global Market Response:

Asian markets rallied sharply, with strong gains in Japan and South Korea. European markets also opened higher. Gold prices extended gains before pulling back slightly, while the dollar weakened against major currencies. The yen held below the 160-per-dollar level.

Economic Data:

U.S. consumer confidence showed an upside surprise for March, while February job openings data was released. Asian factory activity contracted amid rising fuel costs, though South Korea's manufacturing expanded at the strongest pace in over four years, driven by semiconductor demand.

Corporate News:

Nike shares fell sharply after forecasting a surprise drop in Q4 sales, marking the sixth consecutive quarter of declining sales in China.

Upcoming Catalysts:

President Trump scheduled an evening address on Iran. March ADP payrolls, February retail sales, and manufacturing PMI data are due, along with the approaching Q1 earnings season.