Public Markets 3h Briefing
×Market Turmoil and Economic Data
US equity futures bloomberg.com pointed to a down day as oil prices surged and Middle East war worries fanned inflation fears. The S&P 500 futures dropped 0.6% as traders awaited Friday's jobs report, with Marvell bloomberg.com and Oracle investing.com rising premarket while Gap fell sharply.
Retail sales sagged in January wsj.com, extending a tepid trend since late last year as consumers cut back on shopping. The Commerce Department reported declining sales at retailers, adding to economic uncertainty as markets grappled with geopolitical risks.
Geopolitical Tensions Impact Markets
Israel says it's destroyed most of Iran's missile launchers bloomberg.com, causing the number of missiles targeting Israel and the region to fall. However, the conflict continues to roil markets, with oil prices climbing again and fanning concerns that the Middle East war is fueling inflation.
Federal Reserve Governor Christopher Waller said the Iran war is "unlikely to cause sustained inflation" bloomberg.com, viewing the oil price shock as temporary. Meanwhile, Russia emerges as the first clear winner from the Iran conflict bloomberg.com as Indian refiners snap up Moscow's barrels after Middle East flows have bottled up in the Persian Gulf.
Corporate and Credit Market Developments
BlackRock limited redemptions at its private credit fund ft.com after withdrawal requests at the flagship HPS Corporate Lending Fund surged to 9.3% of net asset value. Credit investors are unwinding their gigantic bullish position bloomberg.com, jumping into hedging trades as tens of billions in long positions are liquidated.
Western Alliance Bancorporation sued Jefferies Financial Group ft.com in New York state court over $126.4 million in forbearance payments. Separately, Blue Owl Capital has £36 million exposure to the collapsed UK lender Century Capital Partners bloomberg.com, which filed for administration last month.
Economic Indicators and Policy
US nonfarm payroll employment unexpectedly fell in February investing.com, missing economists' forecasts and boosting expectations for Federal Reserve interest-rate cuts this year. Treasuries rallied after the disappointing payroll report, despite a recent rise in oil prices that threatens to fuel inflation.
Kuwait cut oil production as storage fills up wsj.com, signaling a broader storage crisis that poses new risks to the global market. The International Energy Agency sees no need yet to tap oil stockpiles bloomberg.com amid the Middle East crisis, as global supplies remain plentiful.