Today's Update 04-14-2025
Key Points and Metrics
Key Points and Metrics:
Economic Indicators:
OPEC Monthly Report:
Oil Demand Forecasts Reduced:
2025: Demand growth forecast cut to 1.30 million barrels per day (bpd) from the previous 1.45 million bpd.
2026: Demand growth forecast lowered to 1.28 million bpd from 1.43 million bpd.
Global Economic Growth Forecasts:
2025: Reduced to 3% from the previous 3.1%.
2026: Also lowered, specific figures not provided.
Canadian Wholesale Sales (MoM):
Forecast: 0.4%
Previous: 1.2%
Swiss Producer Price Index (PPI):
Month-over-Month (MoM): Increased by 0.1% (Previous: 0.3%).
Year-over-Year (YoY): Decreased by 0.1% (Previous: -0.1%).
UK BRC Retail Sales (YoY):
Forecast: 0.6%
Previous: 0.9%
Currency Strength Chart:
Strongest to Weakest: NZD, JPY, GBP, AUD, EUR, CAD, CHF, USD.
Market News:
Stock Market Rally:
Stocks rose, led by a surge in tech shares, after President Trump signaled a potential exemption of trade tariffs on some consumer electronics, raising hopes that these products might avoid significant tariff impacts.
Trade Talks Progress:
White House Senior Adviser Kevin Hassett:
Stated that the U.S. is making "enormous progress" in tariff negotiations with the European Union.
Emphasized that he is not expecting a recession this year.
German Economic Outlook:
German Economy Ministry:
Warned of a noticeable weakening in the industrial sector in the coming months due to declining orders and U.S. trade policies.
Noted that uncertainty about German exports remains exceptionally high amid increasing protectionism.
Highlighted a significant increase in the risk of a global economic slowdown, which could considerably affect Germany.
Corporate Earnings:
Goldman Sachs (GS) Q1 2025 Results:
Earnings Per Share (EPS): $14.12 vs. $11.58 YoY.
Revenue: $15.06 billion (Estimates were $14.76 billion).
Equities Trading Revenue: $4.19 billion (Estimates were $3.8 billion).
Net Interest Income: $2.90 billion (Estimate: $2.28 billion).
Approved Share Buyback Program: Up to $40 billion.
Other Metrics:
Fixed Income, Currency, and Commodities (FICC) Trading Revenue: $4.40 billion.
Provision for Credit Losses: $287 million.
Financial Sector Updates:
JPMorgan Chase:
Oil Price Forecast: Cut its 2025 Brent crude forecast to $66 per barrel from $73.
Citigroup:
Equity Ratings Adjustments:
Downgraded U.S. equities to neutral from overweight.
Upgraded Japanese equities to overweight from underweight.
Morgan Stanley:
Asset Management: Collected $2.3 billion for co-investments, aiming to back 30 to 40 deals through the new co-investment pool.
Central Bank Activities:
Federal Reserve Speakers Scheduled:
12:00 PM: Fed's Thomas Barkin speaks.
1:00 PM: Fed's Christopher Waller speaks.
6:00 PM: Fed's Patrick Harker speaks.
7:40 PM: Fed's Raphael Bostic speaks.
Bank of Japan (BoJ):
Governor Kazuo Ueda:
Stated that the BoJ will make monetary policy decisions aimed at achieving the 2% inflation target, while closely monitoring economic and price developments.
Expressed concerns that U.S. tariff policies could exert both upward and downward pressure on prices and impact the Japanese economy.
Trade and Tariff Developments:
U.S. Tariff Policies:
President Trump hinted at a potential exemption for certain consumer electronics from trade tariffs, suggesting a possible compromise in ongoing trade negotiations.
WH Adviser Hassett:
Mentioned that rare earth elements are being studied carefully.
Emphasized a focus on semiconductors that influence national security.
International Agreements:
Vietnam and China:
Signed 45 agreements during President Xi Jinping's visit, strengthening bilateral cooperation.
Energy and Commodities:
OPEC Production Figures:
March OPEC+ Crude Output: Averaged 41.02 million bpd, a decrease of 37,000 bpd from February.
Russia:
Crude oil production decreased by 10,000 bpd in March to 8.963 million bpd, below its OPEC+ quota.
Kazakhstan:
Crude oil production increased by 37,000 bpd in March to 1.852 million bpd, exceeding its OPEC+ quota.
China's Gold Imports:
The Chinese government has offered banks additional gold import quotas due to increased investor demand for the precious metal.
Economic Forecasts and Surveys:
Bank of Canada:
Interest Rate Outlook:
A poll of economists indicates that the Bank of Canada is expected to hold the overnight rate at 2.75% on April 16.
18 out of 29 economists anticipate no change, while 11 predict a 25 basis points cut.
Recession Risk:
14 out of 15 economists surveyed believe the risk of a Canadian recession is high.
European Equity Strategy (Barclays):
Upgraded quality stocks to positive.
Downgraded value stocks to neutral from positive.
Additional Market Insights:
Currency Markets:
Chinese Yuan:
The trade-weighted CFETS Yuan Basket Index fell to 96.61, the lowest level since July 27, 2023.
German Export Concerns:
The German Economy Ministry noted that recovery in German exports is not expected soon due to increasing protectionism and uncertainty in global trade dynamics.
Final Thoughts:
The markets are showing strong positive momentum today, primarily driven by Trump's indication of potential tariff exemptions for consumer electronics. This has particularly benefited tech stocks, with Apple seeing significant premarket gains. Goldman Sachs delivered strong quarterly results, exceeding expectations in several key metrics and announcing a substantial share buyback program.
In the energy sector, OPEC has reduced its demand growth forecasts for both 2025 and 2026, reflecting concerns about global economic growth amid trade tensions. Despite these concerns, White House economic adviser Hassett remains confident about avoiding a recession and reports progress in EU trade talks.
Investors should watch for commentary from multiple Fed speakers today that could provide insights into future monetary policy direction. The market's positive reaction to potential tariff exemptions highlights how sensitive equities remain to trade policy developments, suggesting that further clarification on specific electronics levies could drive additional market movements in the coming days.
Disclaimer: This article is for informational purposes only and does not constitute investment advice. Always do your own research and consider your financial situation before making investment decisions.
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Harry