By Jamie McGeever
ORLANDO, Florida, April 27 (Reuters) – Oil prices rose again on Monday on the lack of any sign that the Strait of Hormuz will reopen soon, but that didn’t prevent the S&P 500 and Nasdaq from eking out new highs, as investors awaited a raft of earnings and central bank meetings this week.
In my column today, I look at why repeated calls for fiscal discipline from the IMF and others will fall on deaf ears. In a divided world with countries spending heavily on energy, military and resource security, deficits and debt are here to stay.
If you have more time to read, here are a few articles I recommend to help you make sense of what happened in markets today.
1. Mediators still seek to bridge U.S., Iran gaps despite no face-to-face talks
2. Fed likely to hold rates steady as Powell prepares for possible swan song
3. OpenAI breaks off Microsoft exclusivity to free up path for Amazon, Google deals
4. DeepSeek’s new AI model does not wow markets in fast-changing industry
5. China orders Meta to unwind $2 billion purchase of AI startup Manus
Today’s Key Market Moves
• STOCKS: Asia mostly up – KOSPI +2% to new high, now +31% in April, set for best month since 1998. Europe slips, UK in longest losing streak for over a year. Wall Street narrowly mixed, tech lifts Nasdaq to new high.
• SECTORS/SHARES: Only three of 11 sectors in the S&P 500 rise – tech, comms services, financials. Nvidia +4% to new high and reclaims $5 trillion market cap, Micron Technology +5.6%. Philadelphia chip index falls for first time in 19 sessions, Domino’s Pizza -9%.
• FX: Dollar index little changed, CAD at 7-week high. Commodity FX AUD and NZD +0.5%. Bitcoin -2% below $77,000.
• BONDS: U.S. yields up 2-3 bps across the curve, 10y yield highest close in two weeks. Auctions mixed – 2y draws strong “direct” bids, decent bid/cover; 5y weak bid/cover but strong “indirect” demand.
• COMMODITIES/METALS: Oil rises, Brent +3% to 3-week high, WTI +2%. Nickel highest in nearly two years. Gold -1%.
Today’s Talking Points
* The $1 trillion club
Three IPOs, three $1 trillion-plus price tags? Elon Musk’s SpaceX is targeting a $1.75 trillion valuation in what would be the largest IPO ever and OpenAI is reportedly seeking a $1 trillion valuation. Could Anthropic be joining them?
Anthropic reportedly drew offers from venture capital firms valuing it at $800 billion earlier this month, and Google on Friday said it will invest up to $40 billion. That will lift the value even higher. Careful though – with IPOs approaching a combined $4 trillion, roughly 16% of the MSCI World IT index, this could create a “significant overhang” for software valuations, warns Candriam.
* Canada SWF
Canada is about to get its first sovereign wealth fund, Prime Minister Mark Carney said on Monday. The Canada Strong Fund will have an initial endowment of C$25 billion ($18.4 billion) to invest in major domestic projects, Carney said.
Canada joins other resource-rich or surplus-heavy nations like Norway, China and many Gulf states to have an SWF. U.S. President Donald Trump has said he wants a U.S. SWF, although that idea appears to have gone cold. Might Carney’s announcement re-focus Trump’s attention to this matter?
* Powell’s last stand
The Fed’s two-day policy meeting begins on Tuesday, and it will almost certainly be Jerome Powell’s last as Fed chair. With the path now seemingly cleared for nominee Kevin Warsh to be confirmed by the Senate by May 15, Powell’s tenure as chair is almost up.
Will he stay on as a Fed governor until 2028, as his terms allow? Possibly. Powell may give more clarity on that at his post-decision press conference on Wednesday. Either way, let the debate begin over his legacy and standing in the pantheon of Fed chairs. Thoughts?
What could move markets tomorrow?
• Developments in the Middle East
• Energy market moves
• Japan interest rate decision
• Japan unemployment (March)
• India industrial production (March)
• European earnings include Barclays, Novartis, BP
• U.S. house prices (February)
• U.S. consumer confidence (April)
• U.S. Treasury sells $30 billion of 2-year floating rate notes and $44 billion of 7-year notes at auction
• U.S. earnings include Coca-Cola, Visa, T-Mobile, Spotify, UPS, Starbucks
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Opinions expressed are those of the author. They do not reflect the views of Reuters News, which, under the Trust Principles, is committed to integrity, independence, and freedom from bias.
(Reporting by Jamie McGeever; Editing by Nia Williams)
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