Ceasefire optimism drives Wall Street to record highs as oil retreats from $100.
This week @ 15:22pm Friday 17th April in London.
Markets:
- FTSE 100 rose 0.3% this week to 10,632, lagging global peers as elevated energy costs and Strait of Hormuz disruptions weighed disproportionately on European companies dependent on Middle Eastern oil flows.
- S&P 500 surged 4.3% this week to 7,110, breaching the 7,000 milestone for the first time as ceasefire optimism, strong bank earnings, and a decisive rotation out of money market funds fuelled risk appetite.
- Nasdaq Composite soared 6.5% this week to 24,387, logging its longest winning streak since 2009 at twelve consecutive sessions as semiconductor strength and the AI spending narrative powered technology stocks higher.
- Euro Stoxx 50 rose an estimated 2.5% this week, with the DAX advancing 3.4% to 24,608 on software and luxury stock strength, though Europe remained vulnerable to energy price shocks from restricted Hormuz access.
Bonds:
- US 10-year Treasury yield was broadly flat this week at 4.30%, trading in a narrow range between 4.23% and 4.31% as resilient labour market data offset ceasefire-driven easing in risk premia.
- UK 10-year gilt yield rose approximately 5bps this week to 4.84%, hitting its highest level since 2008 as the UK’s vulnerability as a net energy importer and inflation expectations approaching 5% forced punitive borrowing rates.
Commodities:
- Brent crude fell approximately 2.5% this week to $96/bbl, retreating sharply from near $100 after Iran’s foreign minister declared the Strait of Hormuz open during the ceasefire period.
- Gold rose approximately 1.0% this week to $4,815/oz, supported by a weakening US dollar and persistent safe-haven demand amid unresolved Middle East uncertainty.
- Copper rose 2.8% this week to $6.04/lbs, supported by robust manufacturing and construction demand with the broader commodity complex up roughly 42% year-to-date.
FX:
- GBP/USD rose 0.8% this week to 1.3534, as a surprisingly strong UK GDP print and fading safe-haven dollar demand offset concerns over the IMF’s downgrade of UK growth to 0.8%.
- GBP/EUR fell approximately 0.4% this week to 1.1459, as stubbornly high eurozone inflation reduced ECB rate cut expectations and the narrowing gilt-bund spread structurally undermined sterling.
Macro:
- US CPI: (March): Headline inflation rose 3.3% year-on-year, slightly below the 3.4% forecast, though it marked the highest reading since May 2024. Core CPI rose 2.6% year-on-year and 0.2% month-on-month, both below consensus. Gasoline prices were the primary driver of the monthly increase.
- UK inflation: (February, most recent): CPI held at 3.0% year-on-year in February, unchanged from January. March CPI data is due for release on 22nd April; the Bank of England has indicated it expects inflation to rise to approximately 3.5% in Q2 and Q3, driven by elevated global energy costs.
- Geopolitics: A fragile two-week US-Iran ceasefire, brokered by Pakistan in early April, remained broadly intact this week, supporting the risk rally. Iran retains gatekeeping authority over the Strait of Hormuz; experts have cautioned the agreement lacks durability, and negotiations towards a longer-term settlement are ongoing.
- Fed Chair: President Trump renewed threats to remove Federal Reserve Chair Jerome Powell before his term expires on 15th May. Markets interpreted this as adding institutional uncertainty to the US rate outlook, contributing to dollar weakness.
Companies:
- JP Morgan Chase (JPM): Reported Q1 2026 earnings of $5.94 per share, ahead of the $5.45 consensus. Revenue rose 10% year-on-year to $50.5bn, with record trading revenue of $11.6bn. Net income was $16.5bn, up 13% year-on-year. CEO Jamie Dimon flagged accumulating macro and geopolitical risks.
- ASML Holding (ASML): Reported Q1 2026 revenue of EUR 8.8bn, in line with guidance, with gross margin at 53.0%, the high end of guidance. Full-year 2026 revenue guidance was raised to EUR 36-40bn. CEO cited accelerating customer demand driven by AI infrastructure investment.
What we will be keeping an eye on next week…
w/c 20th April 2026
- The US-Iran ceasefire expires on 22nd April, with the outcome of weekend diplomatic negotiations representing the single most consequential event for global risk sentiment.
- UK March CPI data on Wednesday is expected to show accelerating inflation driven by energy price pass-through from the Iran conflict, complicating the Bank of England’s policy calculus.
- Kevin Warsh, President Trump’s nominee to chair the Federal Reserve, faces his Senate confirmation hearing on Monday 21st April.
- Flash PMIs for the US and UK on Thursday will provide the first real-time read on April business activity, with particular attention on prices-paid and employment components for signs of stagflationary pressure.
Markets move constantly and the numbers in this update will change. This is a snapshot only, pulled together from a range of sources, and is meant as a quick guide rather than a precise record. It’s not investment advice and shouldn’t be used to make trading or investment decisions. If you need more accurate or specific data over a defined period, please get in touch with a member of the team who will be happy to help.
Important Information
This article is for information only and does not constitute advice or recommendation and you should not make any investment decisions based on it. The views and opinions of this article are those of Casterbridge at the time of writing and may change without notice. Any opinions should not be viewed as indicating any guarantee of return from investments managed by Casterbridge nor as advice of any nature. It is important to remember that past performance and the value of an investment, and any income from it, may go down as well as up and the investor may not get back the original amount invested.