The relative calm in futures markets this morning - with Dow Jones Futures at zero, S&P 500 Future at +0.2% and Nasdaq 100 Future at +0.4% - follows a significant rally Tuesday, driven by a tentative ceasefire between Israel and Iran. Investors cheered the de-escalation, with all three major indices climbing over 1%. While the truce remains fragile, the tone has shifted from panic to patience - an encouraging turn in a year marked by persistent geopolitical friction.

The reason for the collective pause lay some 6,000 miles east, where a cease-fire between Israel and Iran, brokered by the once-again-incumbent Donald Trump, had slipped into its second sunrise. Never mind the scattered violations - rockets that whistled off course like drunks loyal to yesterday's war. For markets, the mere prospect of calm in a region that props up oil prices and geopolitical anxiety was enough to turn dread into détente.
Donald Trump has applied the same strategy in the Middle East that he imposes everywhere else, whether in trade relations, in business, or domestic politics. The matrix is action. Always be on the move. Backtrack rather than soften your stance. Castigate red tape, and therefore break free from rules and customs. This energy is naturally appealing because it undermines the image of inertia and indecisiveness conveyed by most other Western leaders. And ultimately, the financial markets are happy with it.
On Tuesday, the Nasdaq 100 closed at a record high; by dawn Wednesday, the benchmark S&P sat less than a percentage point from its own summit. 
 
Yet the oxygen thins quickly. At 10 a.m. Eastern, Federal Reserve Chair Jerome Powell was due on Capitol Hill for his sequel performance before the Senate Banking Committee. The first installment had been a study in conditional tenses: if inflation cools faster, if the labor market wobbles harder, then cuts - small, surgical - might follow. Futures markets now price in roughly sixty basis points of easing by New Year's Eve 2025. Powell's rhetorical style - Delphic, drily Midwest - has become a spectator sport. Traders lean in for micro-inflections, as though a chairman could rescue or ruin a portfolio with a single adverb.
 
Meanwhile, consumer confidence slipped on Tuesday. The American household is, at once, flush with pandemic savings and freighted with pandemic fatigue, toggling between the urge to spend and the dread of sticker shock. In the wings, Friday's PCE report looms, promising to pronounce judgment on whether Trump-era tariffs are merely background noise or the bass line of a cost-of-living blues.
 
Corporate America contributed its solos of worry and hope. FedEx, that barometer of global pulse rates, warned of a profit pinch as tariffs gnawed at package volumes, sending its stock down more than five percent and tugging rival UPS in sympathy. General Mills trimmed its outlook amid consumers' flirtation with private-label Cheerios. Yet elsewhere, quantum-battery dreamer QuantumScape rocketed thirty-plus percent on a production tweak whose alchemy few fully grasp, while cybersecurity stalwart BlackBerry rallied on the grim comfort that online crime is, at least, reliably abundant.

Wall Street since January has been a parable. A rise until February 19, a slump until April 7, and a trampoline-like rebound. The Nasdaq 100 even broke its record yesterday at 22,191 points. The S&P 500 is just a hair's breadth away from doing the same.

Since the low point on April 7, which falls between the date when Donald Trump launched his all-out offensive on tariffs and the one when he backtracked, the Nasdaq 100 has rebounded by 27.5% and the S&P 500 by 20%. These figures call for two comments. First, the gains have been boosted in particular by technology stocks. Second, the tech giants have actively participated in the rally, as evidenced by the underperformance of the equal-weighted S&P 500 index (if the equal-weighted index underperforms the normal index, it means that the large stocks have contributed more than their actual weight). This observation is reinforced by the 30.5% surge in the Roundhill Magnificent Seven ETF, which tracks the performance of the seven stars of the US stock market.

Another of the week's hot topics is the debate surrounding Donald Trump's mega tax plan, which has set a July 4 deadline for the Republican Party to get its act together and pass the bill. We can expect some twists and turns in the coming days, as deep divisions remain within the president's camp.

Finally, the elephant in the media room is tariffs. Preoccupied by the Israeli-Iranian conflict, the US president has somewhat neglected his obsession. Recently, the US's trading partners, which is to say pretty much every country, have dragged their feet in negotiations. Many believe that the longer these temporary barriers remain in place, the more the United States will feel their economic impact, potentially increasing its willingness to make concessions. It is a risky but understandable tactic. It remains to be seen who will be the first to feel the wrath of the White House in the coming days.

In Asia-Pacific, modest gains were on the cards in Japan, Australia, and South Korea this morning. The increases were a little stronger in India, Hong Kong, and Taiwan. These markets are not keen to fall. European leading indicators are slightly down, with the Stoxx Europe 600 down 0.4%.

Today's economic highlights:

On today's agenda: New home sales and DOE crude oil inventories in the U.S.; new car registrations in the EU27; machine tool orders in Japan; consumer confidence in France. See the full calendar here.

  • Dollar index: 97,780
  • Gold: $3,3322.30
  • Crude Oil (BRENT): $67.56 (WTI) $64.55
  • United States 10 years: 4.31%
  • BITCOIN: $107,267

In corporate news:

  • FedEx shares fell 5% despite a better-than-expected quarterly profit due to a subdued profit forecast.
  • Chip stocks including AMD, Broadcom, Intel, and Nvidia rallied Tuesday following positive market sentiment from a Middle East cease-fire and bullish analyst upgrades.
  • DexCom surged after U.S. health secretary Robert F. Kennedy Jr. endorsed widespread use of health wearables within four years as part of his “Make America Healthy Again” initiative.
  • Boeing is under investigation by the US safety board for a 737 MAX 9 mid-air emergency.
  • United States Steel appointed Kevin Lewis as CFO following its acquisition by Nippon Steel.
  • OpenAI CEO Altman discusses a future partnership with Microsoft CEO Nadella.
  • General Mills shares fell after posting weaker-than-expected Q4 sales and forecasting a sharper-than-anticipated profit decline for fiscal 2026.
  • Microsoft plans significant job cuts in its Xbox division.
  • Nektar Therapeutics' experimental eczema drug achieved its primary goal in a mid-stage trial.
  • Xero acquired Melio for $2.5 billion to double its revenue in three years.
  • Tesla's sales in Europe fell by 27.9% in May compared to the same month last year.
  • Illumina will acquire Somalogic for $350 million, plus $75 million in milestone payments.
  • QXO places 90 million shares at $22.25 each.
  • BlackBerry reported a return to profitability with $1.9 million in net income for Q1 FY2026, driven by strong QNX growth and better-than-expected revenue.
  • Cigna is suing Bristol-Myers Squibb, accusing it of monopolizing the drug Pomalyst, which is used to treat multiple myeloma.
  • Carnival is raising its annual profit target thanks to record demand for cruises.
  • Babcock raises its medium-term forecast due to increased defense requirements.

Analyst Recommendations:

  • Duke Energy Corporation: Goldman Sachs upgrades to buy from neutral with a target price raised from USD 125 to USD 132.
  • Graphic Packaging Holding Company: BNP Paribas Exane downgrades to neutral from outperform with a target price reduced from USD 24.80 to USD 22.60.
  • Kraft Heinz: Goldman Sachs upgrades to neutral from sell with a target price raised from USD 25 to USD 27.
  • Lam Research Corporation: William O'Neil & Co Incorporated upgrades to buy from dropped coverage.
  • Omnicom Group., Inc.: Barclays downgrades to equalweight from overweight with a price target reduced from USD 105 to USD 80.
  • The Interpublic Group Of Companies, Inc.: Barclays downgrades to equalweight from overweight with a target price reduced from USD 34 to USD 27.50.
  • Wec Energy Group, Inc.: Goldman Sachs downgrades to sell from neutral with a target price reduced from USD 106 to USD 100.
  • Yum! Brands, Inc.: JP Morgan upgrades to overweight from neutral with a target price reduced from USD 170 to USD 162.
  • Carnival Corporation: BNP Paribas Exane maintains its outperform recommendation and raises the target price from USD 23 to USD 31.
  • Coinbase Global, Inc.: Bernstein maintains its outperform recommendation and raises the target price from USD 310 to USD 510.
  • Doordash, Inc.: Cantor Fitzgerald maintains its overweight recommendation and raises the target price from USD 210 to USD 260.
  • Ge Vernova Inc.: BM Pekao maintains its sell recommendation with a price target raised from 213 to USD 303.
  • Texas Instruments Incorporated: TD Cowen maintains its hold recommendation and raises the target price from USD 160 to USD 200.