A note from ING with a take on China's data today. China's official manufacturing PMI held at 50.3 in April as export orders returned to growth for the first time since 2024, but the non-manufacturing PMI fell to a 40-month low of 49.4, exposing the weakness in domestic demand.Summary:China's official manufacturing PMI edged down to 50.3 in April from 50.4 in March, coming in above both ING's forecast and broader market expectations, with production ticking up to 51.5 and employment improving slightly though remaining in contraction at 48.8Overall new orders dropped to 50.6 from 51.6, pointing to weak domestic demand, while the new export orders subindex rose to 50.3, returning to expansion for the first time since April 2024The imports subindex also returned to expansion at 50.1 for the first time since March 2024, suggesting trade activity held up solidly through the monthRaw material purchase prices remained elevated at 63.7 and ex-factory prices at 55.1, both slightly lower than March but still consistent with a continuing reflation trend that ING expects the May inflation data to confirmThe private RatingDog manufacturing PMI beat expectations more decisively, rising to 52.2 from 50.8, with ING attributing the outperformance to the index's heavier weighting toward export-oriented private firmsChina's non-manufacturing PMI fell to 49.4 in April, matching January's reading for a 40-month low, with the new orders subindex dropping to 44.3, its lowest level since 2022Non-manufacturing export orders remained in contraction for a 16th consecutive month at 47.3, while the sales price component stayed contractionary for a 31st straight month at 48.1, indicating cost pressures have not yet been passed on to consumers in the services sectorING attributed the underperformance in services to the sector's greater domestic orientation relative to manufacturing, with soft consumer demand increasingly weighing on the non-manufacturing readingChina's April purchasing managers' index data presented a familiar but increasingly pronounced split: a manufacturing sector drawing support from a recovery in external demand, and a services sector struggling under the weight of soft domestic consumption that shows little sign of turning around.The official manufacturing PMI edged down to 50.3 from 50.4 in March, a negligible move that nonetheless came in above both ING's forecast and broader market consensus. Within the detail, production ticked up 0.1 percentage points to 51.5 and employment improved marginally, though it remained in contraction at 48.8. The more significant movement was in orders. Overall new orders fell to 50.6 from 51.6, a drop that ING analysts attributed to continued weakness in domestic demand. The offset came from the external side: the new export orders subindex climbed 1.2 percentage points to 50.3, returning to expansionary territory for the first time since April 2024. The imports subindex also nudged back above 50 for the first time since March 2024, a signal that trade flows held up through the month despite the elevated uncertainty surrounding the Middle East conflict and its effects on shipping costs and supply chains.The private RatingDog PMI, compiled by S&P Global, told a more emphatic version of the same story, rising to 52.2 from 50.8, well above the 51.0 consensus. ING noted that the index's heavier representation of export-oriented private manufacturers explained much of the outperformance relative to the official survey, reinforcing the view that external demand is the engine of China's current recovery while domestic demand remains the drag.On prices, raw material purchase prices held at 63.7 and ex-factory prices at 55.1, both slightly below March but still elevated, consistent with a reflation trend that ING expects to be confirmed when the May CPI data is released on May 11.The services sector offered little comfort. The non-manufacturing PMI fell to 49.4, matching January's reading for a 40-month low, with the new orders subindex dropping to 44.3, its weakest since 2022. Non-manufacturing export orders remained in contraction for a 16th consecutive month, and the sales price component stayed below 50 for a 31st straight month, indicating that cost pressures are not yet being passed on to end consumers. The only relief was a slight uptick in business expectations to 54.7. ING's conclusion was direct: as China's services sector is more domestically oriented than manufacturing, it has begun to underperform as soft consumer demand increasingly dominates the picture, and the gap between the two sides of the economy looks set to persist until meaningful demand-side support arrives.---The split between manufacturing and services is the story here, and it matters for how markets read China's recovery trajectory. Manufacturing is holding up, supported by external demand, with export orders back in expansion for the first time since April 2024. But the non-manufacturing PMI sliding to 49.4, a 40-month low, confirms that domestic consumers and the services sector are not participating in the rebound. That divergence limits the bullish read on the headline data and keeps pressure on Beijing to deliver demand-side stimulus rather than relying on export momentum that could easily be disrupted by further Hormuz complications or a global growth slowdown. On inflation, elevated raw material purchase prices at 63.7 and ex-factory prices at 55.1 confirm the reflation trend is intact, pointing toward further upside in the May CPI print due on the 11th. This article was written by Eamonn Sheridan at investinglive.com.

Nothing propping up JPY so far today. This article was written by Eamonn Sheridan at investinglive.com.

US military commanders are set to present President Trump with fresh options for military action against Iran on Thursday, according to Axios. The plans under consideration include a concentrated strike on Iranian infrastructure aimed at breaking the nuclear negotiation deadlock, a potential ground operation to seize part of the Strait of Hormuz and restore commercial shipping, and a special forces mission to secure Iran's uranium stockpile. This article was written by Eamonn Sheridan at investinglive.com.

The ECB is expected to hold rates at 2% on Thursday. Markets price a 10% chance of a hike today but look to June for the first move. Lagarde's tone on inflation and the Middle East conflict will drive the euro's reaction.Summary:The ECB is widely expected to hold its key deposit facility rate at 2% at Thursday's meeting, with market pricing implying just a 10% probability of a hike todayJune is the meeting to watch, with markets pricing between 20 and 40 basis points of tightening by then and BNP Paribas economists flagging it as the most likely point for a 25bp increaseThe Eurozone composite PMI fell to 48.6 in April, slipping into contraction territory, while inflationary pressures continued to strengthen, presenting policymakers with a classic stagflationary setupECB staff projections from March revised headline inflation up to 2.6% for 2026 and cut GDP growth to 0.9%, reflecting the energy price shock from the Middle East conflictLagarde said in late March the ECB was ready to hike even if an inflation overshoot proved temporary, and markets will be listening closely for any softening or reinforcement of that stance todayAnalysts at TD Securities say the euro could fall around 0.30% even under a neutral scenario where the ECB holds without committing to June, as markets would read that as a pushback against current hike pricingTighter bank credit standards and weak PMIs are increasing growth concerns within the Governing Council, which could temper the hawkish impulse despite sticky inflationThe European Central Bank is expected to leave interest rates unchanged at 2% on Thursday, but the decision itself is almost beside the point. With markets assigning just a 10% probability to a hike today, attention will be squarely on President Christine Lagarde's press conference and whether her language reinforces or softens expectations for a move in June.The case for caution is clear. The Eurozone composite PMI slipped to 48.6 in April, falling back into contraction territory, and the ECB's own March projections already cut 2026 GDP growth to 0.9%, the lowest in the current forecast cycle. Tighter bank credit standards are adding to signs of a demand slowdown, and with the Eurozone a net energy importer, the Middle East conflict is acting as a direct drag on real incomes and confidence. The ECB will be keen to stress that the bloc is better insulated from an energy shock than it was in 2022 when Russian gas flows collapsed, but the comparison only goes so far.The case for leaning hawkish is equally compelling. Inflationary pressures strengthened even as the April PMI fell, a textbook stagflationary signal. Lagarde has already said the ECB would not hesitate to act if second-round price effects from energy and food begin to take hold, and BNP Paribas economists expect the data to support a 25bp hike at the June meeting absent a sustained fall in energy prices. Markets are currently pricing around 50 basis points of tightening by year-end, placing the ECB on course to out-hike the Federal Reserve in 2026.Analysts at TD Securities put a 40% probability on a hawkish outcome today in which Lagarde leans into the inflation risk and signals the ECB will not wait indefinitely, a scenario they see driving the euro around 0.20% higher against the dollar. However, they also warn that a neutral hold without a clear June commitment could push the euro down around 0.30%, as markets interpret any ambiguity as a subtle pushback against current pricing. The longer-term euro bulls are not giving up, pointing to the prospect of a tighter rate differential with the US once the war risk premium unwinds, with EUR/USD potentially revisiting the year-to-date peak of 1.2078. For now though, Lagarde's words carry more weight than Frankfurt's decision.---Statement due at 0815 US Eastern time. European Central Bank President Lagarde presser follows a half hour later:---A hold is fully priced in with markets assigning only a 10% chance of a move today, so the rate decision itself will not move the euro. What matters is Lagarde's tone. Analysts at TD Securities see a 40% chance of a hawkish press conference that pushes EUR/USD up around 0.20%, but note that a neutral hold with no June commitment could send the euro lower by around 0.30% as markets pare back hike expectations. Broader forces, oil prices and global risk sentiment, remain stronger drivers of EUR/USD than rate differentials for now, with the pair needing the war risk premium to unwind before any sustained move higher toward the year-to-date peak of 1.2078. This article was written by Eamonn Sheridan at investinglive.com.

Brazil's Copom unanimously cut the Selic 25bp to 14.50% but offered no forward guidance, warning that future moves depend on the depth and duration of the Middle East conflict and that inflation projections are moving further from target.Summary:Copom cut the Selic rate by 25 basis points to 14.50% on Wednesday in a unanimous decision, matching the expectations of 31 of 35 economists in a Reuters pollThe committee offered no forward guidance for a second consecutive meeting, saying future rate adjustments will incorporate new information on the depth and duration of the Middle East conflictPolicymakers flagged deanchored inflation expectations, rising headline and core inflation, and projections moving further from the 3% target, reinforcing a stance of serenity and cautionThe easing cycle began in March with an initial 25bp cut from a nearly 20-year high of 15.00%, with the central bank citing an extremely restrictive policy stance as justification for the start of cutsThe Focus survey's 2026 IPCA projection has risen for six consecutive weeks to 4.80%, above the 4.50% target ceiling, driven by Iran war energy price pass-throughThe BRL has strengthened since March, supported by Brazil's wide interest rate differential with advanced economies, helping contain imported inflation pressuresCopom also flagged ongoing monitoring of domestic fiscal policy developments and their impact on financial assets and monetary conditionsBrazil's central bank cut its benchmark Selic rate by 25 basis points to 14.50% on Wednesday, delivering a second consecutive reduction since launching its easing cycle in March, but the accompanying statement made clear that policymakers see the path ahead as narrow, conditional and increasingly complicated by external forces.The vote was unanimous across the rate-setting committee, known as Copom, and the outcome was in line with the expectations of the large majority of market economists. But the language surrounding the decision was notably cautious. Policymakers reiterated the need for serenity and caution and declined for a second straight meeting to offer forward guidance on future moves, instead conditioning the pace of further cuts on incoming information about the depth and duration of the conflict in the Middle East. The Iran war and its effects on global energy prices, supply chains and the broader growth outlook have introduced a layer of uncertainty that the committee was unwilling to look through.The domestic inflation picture is not cooperating. Copom stated explicitly that headline inflation and measures of underlying inflation have risen and are moving further from the 3% target, and that uncertainty around projections has considerably increased. Inflation expectations remain deanchored, the labour market is adding to price pressures, and the Focus survey of market economists has revised the 2026 IPCA projection upward for six consecutive weeks, reaching 4.80%, above the 4.50% upper bound of the target tolerance band. Before the Hormuz crisis began reshaping global energy markets, analysts had projected Brazilian inflation comfortably below 4% for the year.The context for the cut is important. The Selic had been held at 15.00%, a near 20-year high, since July 2025 as Copom pursued an aggressive tightening cycle to drag inflation back to target. The justification for beginning to ease was the exceptionally restrictive level of rates rather than any meaningful improvement in the inflation outlook, and that framing remains intact. Brazil carries one of the highest real interest rates in the world, and the wide differential with advanced economies has helped support the BRL since the March meeting, with a stronger currency reducing the cost of imports and providing some offset to energy-driven price pressures.The committee also flagged continued monitoring of domestic fiscal policy and its interaction with monetary conditions and financial assets, a reference to the ongoing tension between fiscal expansion and the central bank's price stability mandate. Any deterioration on that front, combined with further Middle East escalation, would quickly erode the already thin justification for continued easing and could see the cycle pause entirely in the months ahead. Copom (Comitê de Política Monetária) is Brazil's monetary policy committee, the equivalent of the Federal Reserve's FOMC or the Bank of England's MPC. It meets every 45 days to set interest rates and is part of the Banco Central do Brasil.Selic (Sistema Especial de Liquidação e Custódia) is Brazil's benchmark overnight interest rate, the equivalent of the Fed Funds rate or the Bank of England's base rate. It is the primary tool Copom uses to control inflation and is the rate at which banks lend to each other on an overnight basis using government bonds as collateral. This article was written by Eamonn Sheridan at investinglive.com.

Goldman Sachs says the UAE's OPEC exit poses greater medium-term than short-term oil supply upside risk, with UAE crude production potential estimated at just over 4.5 million bpd, constrained near-term by Hormuz closure. Summary:Goldman Sachs said the UAE's OPEC exit, effective May 1, poses a greater upside risk to oil supply over the medium term than the short term, as the Strait of Hormuz closure currently caps UAE output regardless of quota statusThe bank said the exit follows years of tension over the UAE's production quota and comes in the context of the US-Israel war on Iran, in which the UAE has faced significant Iranian attacks despite Iran holding OPEC membership and quota exemptionGoldman's base case assumes UAE crude production recovers to 3.8 million bpd by October 2026, above the pre-war level of 3.6 million bpd, but the exit implies upside risk to that forecastThe bank estimates the UAE's potential crude production capacity at just over 4.5 million bpd as of February 2026, with ADNOC formally targeting 5 million bpd by 2027Goldman's base case models cumulative Gulf crude production losses of 1.83 billion barrels by December 2026, with global oil inventories needing replenishment once the Strait reopensOil prices surged more than 6% on Wednesday as deadlocked US-Iran negotiations heightened concern over prolonged supply disruptionThe UAE produced 3.4 million bpd before the war but output slumped by nearly half to around 1.9 million bpd in March following the Hormuz closure, according to data cited by The NationalGoldman Sachs has assessed the UAE's departure from OPEC and OPEC+ as a medium-term rather than short-term supply risk, with the effective closure of the Strait of Hormuz insulating oil markets from any immediate increase in Abu Dhabi's output even as the emirate sheds the quota constraints that had held its production well below capacity for years.The UAE confirmed on Tuesday that it would exit the producer group with effect from May 1, ending a membership that dates to Abu Dhabi's joining in 1967, four years before the UAE was formally constituted as a country. The decision, framed by Abu Dhabi as a matter of national interest and long-term strategic alignment, follows sustained friction with OPEC over production quotas that had capped UAE output at roughly 3.2 million bpd under the broader OPEC+ framework, against a current production capacity of approximately 4.85 million bpd built through a $150 billion ADNOC investment programme. In effect, the UAE had been producing close to 30% below its physical ceiling as an OPEC member, a gap that had become increasingly difficult to justify as ADNOC accelerated its expansion timetable and the Iran war removed any remaining diplomatic incentive for restraint.Goldman said the exit follows years of quota discussions and arrives at a moment of acute geopolitical stress, with the UAE having absorbed significant Iranian attacks during the conflict despite Iran retaining OPEC membership and operating under a quota exemption. The bank's core observation is that the Hormuz closure currently dominates the supply picture. UAE crude production, which stood at 3.4 million bpd before the war, slumped to roughly 1.9 million bpd in March as export routes through the strait were disrupted, though the Fujairah terminal on the Gulf of Oman has provided a partial alternative corridor. Until freedom of navigation is restored through Hormuz, the formal removal of quota obligations changes little in terms of barrels reaching the market.The medium-term calculus is different. Goldman's base case has UAE crude production recovering to 3.8 million bpd by October 2026, already above the pre-war level of 3.6 million bpd, but the bank explicitly flags upside risk to that figure now that quota constraints have been removed. Its estimate of UAE production potential sits at just over 4.5 million bpd, a figure consistent with Rystad Energy's assessment that ADNOC could reach that level within 12 months of quota removal if export routes are available. ADNOC's own publicly stated target of 5 million bpd by 2027 sets the longer-range ceiling, a goal the company has brought forward from an earlier 2030 timeline on the back of sustained capital investment.Goldman's broader base case models cumulative Gulf crude production losses of 1.83 billion barrels through December 2026, with global oil inventories requiring replenishment once the Strait eventually reopens. That inventory rebuild dynamic, combined with an unconstrained UAE production ramp, points to a period of significant supply addition in the post-war order, reinforcing the bank's revised Q4 2026 Brent forecast of around $90 per barrel. That is well below the levels above $110 at which Brent was trading on Wednesday, when prices surged more than 6% as deadlocked US-Iran negotiations raised fears of prolonged disruption. The structural question hanging over markets is how quickly that gap between current elevated prices and post-war normalisation closes once the geopolitical situation resolves, and whether ADNOC's ambitions accelerate or smooth that repricing. ---Goldman's framing is precise: this is a medium-term supply event, not a short-term one. While Hormuz remains closed, Abu Dhabi cannot move materially more oil regardless of quota status, so the immediate price signal is institutional rather than physical. The bank's base case already prices in cumulative Gulf crude losses of 1.83 billion barrels by December 2026 and assumes inventories will need rebuilding once the Strait reopens.The medium-term ceiling is where the numbers become significant. Goldman estimates UAE production potential at just over 4.5 million bpd, against a pre-war output of 3.6 million bpd and a base-case recovery target of 3.8 million bpd by October 2026. ADNOC's stated 5 million bpd target by 2027 gives that figure credibility. The combined effect of post-war inventory restocking and an unconstrained UAE ramp-up would add substantial barrels to the market, reinforcing Goldman's revised Q4 2026 Brent forecast of around $90 per barrel, well below the $110-plus levels at which crude was trading on Wednesday. This article was written by Eamonn Sheridan at investinglive.com.

GOOG, MSFT, META: Options market braced for $1 trillion market cap swing after the bellTrump: It is a good time to cut ratesPowell says he will remain as a Federal Reserve GovernorPowell: Labor demand has softened clearlySo long JPOW and thanks for all the memesWhat are the changes in the FOMC statement from March to April 2026The full statement from the Federal Reserve April FOMC meetingFOMC decision: No change in rates as expectedNo one understands just how big the AI capex boom is. Some perspectiveTrump: I will not lift the naval blockade without a deal on the nuclear programBitcoin finds willing sellers near resistance targets, and the technical tilt shifts down.Bank of Canada's Macklem: Under base case, changes to the policy rate likely to be minimalEIA weekly crude oil inventories -6234K vs -231K expectedHow and why all the Bank of Canada forecasts changed in the latest MPRBank of Canada statement from the April 2026 rate decisionBank of Canada rate decision: Hold at 2.25% as expectedUS March Trade advanced goods trade balance -$87.8B versus $-86.95 billion estimateUS March housing starts 1.502m vs 1.400m expectedUS durable goods orders for March +0.8% vs +0.5% expectedGermany April preliminary CPI +2.9% vs +3.0% y/y expectedThe FOMC left rates unchanged, but the decision revealed a meaningful split beneath the surface.The vote came in at 8–4, with Miran dissenting in favor of a rate cut, while Hammack, Kashkari, and Logan supported holding rates but opposed adding an easing bias to the statement. That group effectively pushed back against signaling near-term rate cuts—giving the decision a hawkish tilt, especially heading into the leadership transition from Jerome Powell to Kevin Warsh.That said, the broader committee still leans dovish. Eight members supported maintaining the easing bias, meaning the path of least resistance still points toward eventual rate cuts—even if the timing remains uncertain.As for Powell, this marked his final meeting as Fed Chair. He noted that he intends to remain at the Fed in a lower-profile role, particularly as legal challenges involving the institution continue to play out.Key Takeaways from his press conference: Inflation still a problem: Core PCE seen at 3.2%, headline PCE 3.5%; near-term inflation expectations are rising, partly driven by higher energy prices Labor market cooling but stable: Demand has softened, job growth is slowing, but the labor market is not deteriorating sharply Consumer remains resilient: Spending continues to hold up despite higher prices Policy stance = patient: No urgency to remove the easing bias No support for rate hikes right now Debate was “vigorous,” but the majority favored no change in guidance Next 30–60 days of data will be key Internal divide at the Fed: Some favor moving toward neutral to reflect markets Others prefer waiting in case policy needs to reverse Bottom line on policy: Fed is not in a hurry to shift direction Inflation is “misbehaving,” but labor is stabilizing → keeps Fed cautious and data-dependent Tone / Bias: Slightly hawkish hold → inflation concerns + no rush to ease But not outright hawkish → no appetite for hikes Market implication: Supports higher yields / stronger USD bias near term Keeps volatility tied to incoming inflation and labor dataAs such, yields did indeed move higher. Looking at the yield curve:2 year yield 3.946%, rose 10.3 basis points10 year yield 4.429%, rose 7.6 basis points30 year yield 4.999%, rose 5.5 basis pointsUS stocks closed little changed. Both the S&P and the Nasdaq moved 0.04% on the day with the S&P down -0.04% and the Nasdaq up 0.04%. The Dow and the Russell 2000 the story was less encouraging with each falling by around -0.60^. The USD moved higher with the USDJPY breaking to the upside and reaching a new high for the year going into the close above 160.45. The EURUSD is trading just under its 200 day MA at 1.1674 (at 1.1671).The Bank of Canada also met today, and kept rates unchanged (concerned about employment getting wearker and inflation moving higher but then coming back off later in the year - if oil price came down. The USDCAD moved higher after the decision and away from the converged 100/200 hour MAs at 1.3666. However, the price bounced off of that level, keeping the buyers in play. If the price is to move higher from here, it needs to stay above the MAs and also extend above the high from last week at 1.3715 and the 100 day MA at 1.37295.Oil prices was also a tailwind for yields moving higher, and the USD moving higher. It surged by 8.57% on the day as the Trump administration signaled the strategy to starve Iran by the blockaid of the Strait of Hormuz. That plan could keep the flow of ships limited for "months". This article was written by Greg Michalowski at investinglive.com.

China's official manufacturing PMI is forecast to ease to 50.1 in April from 50.4 in March, as Iran war-driven energy costs pressure factory margins, a Reuters poll of 27 economists shows. Summary:The official manufacturing PMI is forecast at 50.1 for April, down from 50.4 in March, according to the median estimate from a Reuters poll of 27 economists, with the data due from the National Bureau of Statistics on ThursdayChina's Q1 GDP grew 5%, hitting the upper end of the government's annual target, and industrial profits expanded at their fastest pace in six months in March, providing a relatively stable baseline ahead of the PMI releaseFactory-gate prices reversed a 41-month deflationary run in March, rising sharply in energy-intensive sectors including non-ferrous metal mining, though ANZ analysts have described cost-push inflation of this kind as negative for growthThe People's Bank of China kept benchmark loan prime rates on hold for an eleventh consecutive month last week, with Q1 momentum and a pickup in inflation reducing pressure for fresh easingMoody's revised China's sovereign outlook to stable from negative earlier this week, citing resilient economic and fiscal fundamentalsChina's top leadership acknowledged a strong start to 2026 but flagged difficulties ahead, pledging to strengthen energy security and pursue greater technological self-sufficiencyThe extent to which China's strategic reserves, diversified energy mix and robust electronics export demand continue to insulate the economy from the Iran conflict's fallout is the central question the April data will begin to answerChina's official manufacturing purchasing managers' index is expected to slip to 50.1 in April from 50.4 in March, according to the median forecast from a Reuters poll of 27 economists, with the National Bureau of Statistics set to publish the result on Thursday. The reading would mark the third consecutive month of expansion in the factory sector but at a pace that points to increasing strain from the energy price shock flowing through global supply chains since the escalation of the US-Israeli war on Iran.The broader economic backdrop entering the release is more resilient than many had feared at the start of the year. GDP expanded 5% in the first quarter, landing at the upper end of Beijing's annual growth target, and industrial profits rose at their quickest rate in six months in March. That combination has reduced immediate pressure on policymakers to deploy large-scale stimulus, a position reinforced by Moody's decision earlier this week to revise China's sovereign outlook to stable from negative, citing what the agency described as resilient economic and fiscal strength. The People's Bank of China kept benchmark loan prime rates unchanged for an eleventh straight month last week, consistent with a central bank that sees sufficient momentum to hold its fire on further easing.But the conditions underpinning that relative optimism are showing signs of strain. Factory-gate prices in China ended a 41-month deflationary run in March, with prices climbing in energy-intensive industries including non-ferrous metal mining as the costs of higher global crude and freight rates fed through to domestic producers. The distinction between demand-driven and cost-driven inflation matters considerably here. Analysts at ANZ have characterised the current configuration as unfriendly to the economy: firms absorbing higher input costs without a corresponding pickup in end-demand face margin compression rather than pricing power, and over time that dynamic risks converting a slowing PMI into an outright contraction signal.China's initial insulation from the Iran conflict has rested on three pillars: ample strategic petroleum reserves that cushioned the first wave of oil price increases, a diversified energy mix that reduces dependence on any single import corridor, and strong global demand for Chinese-made electronics that sustained export volumes even as goods export growth softened in March. All three remain in place, but none is unlimited. Strategic reserves can be drawn down only so far before they require replenishment at elevated market prices, while electronics demand is itself sensitive to the global growth slowdown that prolonged Middle East disruption threatens to accelerate.China's top leaders acknowledged the complexity of that outlook in a meeting earlier this week, describing the economy as having achieved a strong start to 2026 while also facing difficulties and challenges. They committed to strengthening energy security alongside technological development and self-sufficiency, language that reflects a leadership reading the geopolitical environment as a structural rather than transitory constraint on growth. Thursday's PMI will be the first major official data point of the month to test whether April marks a continuation of the first quarter's resilience or the beginning of a more material deceleration. ---Official PMIs due at 2130 US Eastern time and the unofficial follows at 2145:---A reading of 50.1 keeps China in expansion but confirms directional softening, and in commodity markets direction matters as much as level. Base metals are the most exposed: copper and aluminium have already been whipsawed by Middle East supply disruption, and a weakening Chinese factory PMI removes a key demand support. Oil is more ambiguous, with softer Chinese industrial activity pulling against the same Iran conflict that is constraining supply on the other side of the equation.The more pointed concern is the inflation dynamic. Factory-gate prices ended a 41-month deflationary run in March, but the driver is cost-push rather than demand-pull, a configuration ANZ has described as unfriendly to growth. With the PBOC on hold for an eleventh consecutive month and Q1 GDP providing political cover to sit tight, policymakers have room to wait, but a PMI trending toward 50.0 alongside margin-compressing input inflation would shift that calculus quickly. This article was written by Eamonn Sheridan at investinglive.com.

Official Chinese PMIs are expected to have slipped in April. The private survey manufacturing PMI, from Rating Dog (ps there is no better named data provider than this), on the other hand, is expected to have risen. I'll get a preview of this posted soon. This article was written by Eamonn Sheridan at investinglive.com.

Shares of Amazon initially fell but are now 1.7% higher on earnings. (now 3.2% lower).Revenue of $181.5B vs $177.3B expQ2 revenue guide of $194-199B vs $188.9B exp (but this does include Prime Day in Q2 this year)Capex hit $44.2B, up 77% YoY. TTM capex stands at $147.3B, up 67% from $88.0B a year ago. Free cash flow collapsed to $1.2B on a TTM basis, down 95%. Amazon explicitly attributes this to AI investment. Operating cash flow grew 30% to $148.5B TTM — and essentially every incremental dollar is being redeployed into data centers.The funding shift is the most important development in the quarter. Long-term debt jumped from $65.6B to $119.1B in three months — a $53.4B issuance versus $746M in Q1 2025. The most cash-generative company on earth just borrowed $53B in a quarter. Operating cash flow alone can no longer fund the cycle. This mirrors Alphabet's recent $20B bond (including a 100-year tranche) and signals the hyperscaler complex is transitioning from self-funded to capital-markets-funded. That's a regime change. Cash climbed to $101.8B — Amazon is building a war chest for what's coming.AWS revenue hit $37.6B, up 28% YoY — the fastest growth in 15 quarters. Operating margin expanded to 37.7% from 35.0% last quarter. Like Azure (39% CC) and Google Cloud (~50% expected), AWS is supply-constrained: 28% is a ceiling set by capacity, not demand. Margin expansion despite massive depreciation drag suggests revenue is still outrunning the depreciation curve — for now.Custom silicon is now a real business. Graviton, Trainium, and Nitro hit a $20B annual run rate, growing triple digits. Amazon deployed 2.1 million+ AI chips over 12 months, more than half Trainium. Forward commitments are staggering: Anthropic signed for up to 5 GW of Trainium, OpenAI committed to 2 GW ramping in 2027. The OpenAI deal is particularly notable — Microsoft's flagship AI partner is diversifying to Amazon. Trainium is now competitive at frontier-model scale.Bedrock processed more tokens in Q1 than all prior years combined, with customer spend +170% QoQ. That's exponential adoption and likely Amazon's answer to Microsoft's $37B AI run-rate disclosure.Q2 guidance hints at margin pressure. Revenue guided $194–199B (+16–19%); operating income $20–24B. The midpoint implies only 15% operating income growth, well below Q1's 30%. D&A was $18.9B, up 33% YoY — depreciation will accelerate as $44B+ in new quarterly capex enters service. The wide $4B operating income range suggests Amazon itself is uncertain about the depreciation curve.No full-year capex or 2027 guide. Q1's pace implies 2026 capex of $210–230B for Amazon alone, pushing the four-name hyperscaler total to $650–700B+. With 7 GW of contracted compute coming in 2027, Amazon's 2027 capex could run $250–300B+ — larger than Australia's entire federal budget. This article was written by Adam Button at investinglive.com.

EPS 4.27 (exp. 4.05)Revenue of $82.89bn beat the $81.46bn consensus estimate, implying approximately 18% year-on-year growth from $70.06bn in Q3 FY2025EPS of $4.27 exceeded the $4.03 estimate; operating income of $38.40bn cleared the $36.9bn forecastAzure and other cloud services grew 39% in constant currency, beating management's own 37-38% guidance and reversing a multi-quarter deceleration trendTotal Cloud revenue of $54.5bn beat the $53.78bn estimate; Microsoft 365 Commercial Cloud grew 19%, Consumer Cloud grew 33%Capex including finance leases of $31.9bn came in approximately $3.4bn below the $35.29bn consensus estimate, easing free cash flow pressure concernsDynamics 365 grew 22% and LinkedIn 12%; Xbox content and services fell 5% and Windows OEM and Devices declined 2%Microsoft announced a restructured OpenAI partnership on April 27, eliminating outbound revenue-share payments to OpenAI while retaining Azure priority and a non-exclusive model licence through 2032The results arrive after Microsoft's worst single-day market cap loss in its history following Q2 earnings, when $357bn was erased despite a headline revenue beatMicrosoft delivered a broad earnings beat in its fiscal third quarter of 2026, posting revenue of $82.89bn against the $81.46bn consensus and EPS of $4.27 versus the $4.03 estimate, at the same time producing a significant undershoot on capital expenditure that analysts had flagged as the single most important number in the report. Capex including finance leases came in at $31.9bn, roughly $3.4bn below the $35.29bn estimate, providing the clearest signal yet that the company's AI infrastructure buildout is moderating toward a more predictable pace after quarters of escalation that rattled investor confidence.The Azure result is the second headline that matters. Azure and other cloud services grew 39% in constant currency, a point above the top of the 37-38% guidance range that management had set on the Q2 call in January. The beat reverses a multi-quarter trend of sequential deceleration, from 40% constant currency in Q1 FY2026, to 38% in Q2, with guidance for further slowdown in Q3 that has now proven too conservative. Management had repeatedly argued that the deceleration was supply-constrained rather than demand-limited, pointing to CFO Amy Hood's disclosure that Azure could have grown above 40% in earlier quarters had the company allocated all newly commissioned GPU capacity to the cloud segment rather than splitting it across Copilot, GitHub Copilot and internal workloads. The Q3 print validates that framing and should put to rest the concern that Azure growth is entering a structurally lower range.Total Cloud revenue of $54.5bn against a $53.78bn estimate continues Microsoft's trajectory of crossing new thresholds in its cloud business, which crossed $51.5bn for the first time in Q2. Microsoft 365 Commercial Cloud revenue growth of 19% and Consumer Cloud growth of 33% are the clearest signs that Copilot monetisation is beginning to flow through to revenue per user, a metric the market had identified as the most important indicator of whether the AI product cycle was generating genuine incremental value or simply spreading licence costs more thinly. Dynamics 365 at 22% growth outpaced the prior quarter's 19% and points to accelerating AI adoption within Microsoft's business applications stack.LinkedIn at 12% growth is steady, while Xbox content and services at -5% and Windows OEM and devices at -2% reflect ongoing softness in consumer-facing hardware and gaming that has been a feature of Microsoft's results for several quarters. Neither metric is likely to weigh on market reaction given the degree to which the investment thesis has shifted toward Cloud and AI monetisation.The context for this report is unusually charged. Microsoft's stock had fallen more than 20% from its October 2025 highs by the time of today's print, including a single-session loss of approximately $357bn in market value following Q2 results in January, when investors looked past a headline revenue beat and focused instead on $37.5bn in quarterly capex, slower-than-expected Copilot adoption and concerns about the economic structure of the OpenAI relationship. The restructuring of that partnership, announced two days before this report, eliminates Microsoft's outbound revenue-share obligations to OpenAI while preserving Azure as OpenAI's primary cloud platform and extending the IP licence through 2032 on a non-exclusive basis. That arrangement reduces margin drag and removes a specific risk that had been cited repeatedly by analysts as a reason to question the quality of the commercial remaining performance obligation backlog, which stood at $625bn at the end of Q2. This article was written by Eamonn Sheridan at investinglive.com.

EPS 2.82 (exp. 2.63), Raises dividend +5% to 0.22/shrTotal revenue came in at $109.90bn, beating the $107.1bn consensus estimate and representing approximately 22% growth year-on-year from $90.2bn in Q1 2025Revenue excluding traffic acquisition costs reached $94.67bn versus a $91.57bn estimateOperating income of $39.70bn significantly exceeded the $36.19bn consensus forecast, pointing to margin leverage despite a heavy investment cycleGoogle Services revenue of $89.64bn topped estimates of $88.11bn, with Search and Other at $60.40bn versus a $59.08bn estimateTotal Google advertising revenue of $77.25bn beat the $76.21bn estimate; YouTube ads were the sole miss at $9.88bn versus a $9.97bn estimateGoogle Cloud revenue of $20.03bn crushed the $18.41bn estimate, continuing the segment's acceleration from $17.66bn in Q4 2025 and $12.26bn in Q1 2025Capital expenditure of $35.67bn came in marginally below the $36.39bn estimate, with full-year 2026 capex guidance of $175-185bn remaining in placeThe report follows Alphabet's $32bn acquisition of cloud security firm Wiz, which closed on March 11 and is now integrated within Google CloudAlphabet delivered a sweeping beat across nearly every financial metric in its first-quarter 2026 results, posting total revenue of $109.90bn against a Wall Street consensus of $107.1bn, representing year-on-year growth of approximately 22% from $90.2bn in the same period a year earlier. The result marks what analysts had previewed as the company's strongest quarterly growth rate since 2022, and the actual figures exceeded even that already elevated expectation.The headline that will dominate market discussion is Google Cloud. Revenue from the division hit $20.03bn in the quarter, running approximately $1.6bn or nearly 9% above the $18.41bn analyst estimate. That acceleration builds on a 48% year-on-year growth rate posted in Q4 2025 and compares to $12.26bn in Q1 2025, implying growth above 63% year-on-year. The result is the most direct evidence yet that Alphabet's aggressive AI infrastructure buildout is generating tangible enterprise revenue at scale. The Cloud backlog stood at $240bn entering the year, roughly four times annual Cloud revenue, and the Q1 print suggests that backlog is converting into recognised revenue faster than the market had modelled. Alphabet's acquisition of Wiz, the cloud security platform, closed on March 11 for approximately $32bn in what was the largest deal in company history. Though near-term revenue contribution from Wiz was not expected to be material, management commentary on integration momentum and pipeline traction will be closely watched by investors assessing the deal's strategic logic.On the core advertising business, Google Search and Other revenue of $60.40bn exceeded the $59.08bn estimate and extended the narrative that AI Mode and AI Overviews, powered by Gemini, are expanding search engagement rather than replacing it. CEO Sundar Pichai had noted at Google Cloud Next that 75% of all new code written at Google is now AI-generated and that first-party models are processing 16 billion tokens per minute through direct customer APIs. That capacity underpins both the Cloud growth story and the Search monetisation thesis. Total advertising revenue of $77.25bn beat the $76.21bn consensus, providing further confirmation that the advertising market remains resilient despite macroeconomic uncertainty stemming from elevated energy prices following the US-Iran conflict and ongoing concerns about EMEA spending.YouTube advertising was the one segment that fell short, coming in at $9.88bn versus a $9.97bn estimate. While marginal, the slight miss continues a pattern of YouTube revenue growth moderating from peak levels, and will be a focus area on the earnings call. The platform's FIFA World Cup 2026 highlights deal was expected to provide a near-term revenue lift, though the degree to which that boosted Q1 versus upcoming quarters remains to be seen.Operating income of $39.70bn against a $36.19bn estimate was perhaps the most strategically significant beat in the report because it demonstrated margin leverage at a moment when investors had been pricing in meaningful compression from AI infrastructure depreciation costs. With capex at $35.67bn in the quarter, slightly below the $36.39bn forecast, the company appears to be executing its $175-185bn full-year 2026 spending plan in an orderly fashion rather than front-loading the buildout. That discipline, combined with strong Cloud margins, addresses the central concern that had hung over the stock: whether Alphabet could absorb one of the largest corporate capital expenditure programmes in history without destroying near-term profitability. On this report, the answer is a clear yes.---Earlier:AlphabetGoogle has the widest gap between expectation and history: a 5.75% implied move against just a 1.4% four-quarter average — roughly 4x. The options market is looking at a few things: Cloud reacceleration, search resilience against AI overviews, and Gemini monetization. This article was written by Eamonn Sheridan at investinglive.com.

Highlights of the Q1 report from Meta:Sees $58-61 billion next quarter vs $59 billion consensusExpects capex spend of $125-145B vs $115-135B previouslyThe capex continues to go up, which is great news if you're in the chip-making or data-center building business. The release specifically cited data center spending. That's not so great for Meta shareholders as they're down 4%, in part due to the runaway spending. There was talk recently of large Meta layoffs as well. This article was written by Adam Button at investinglive.com.

The oil market is in a bit of a panic today. The main catalyst is a Politico report saying:White House officials huddled with oil industry executives Tuesday to discuss steps to tamp down the surge in energy prices in the event the U.S. keeps its blockade of Iranian ships in place for months.There are also increasing reports about US military activity in the region and a report saying the US had planed for a short wave of strikes. Weighing against that is a report that a US aircraft carrier has left the region.The market appears to be concluding that the Iran war isn't on the verge of ending, as it seemed at several occasions in the past two weeks, particularly when Iran briefly announced that Hormuz was open.It's incredible that stock markets are taking this in stride. This article was written by Adam Button at investinglive.com.

The setup tonight is unusual. Meta, Microsoft, and Alphabet all report after the close within roughly the same five-minute window — and the options market is pricing meaningful, but uneven, dispersion across the three names. The straddles are sending mixed signals about where the real risk is hiding.MicrosoftThe implied move sits at 7.4%, well above its 6.2% four-quarter average. That's the options market saying this print matters more than the recent norm — and it's almost certainly Azure. After two consecutive quarters of cloud growth deceleration and the recently announced restructuring of the OpenAI commercial agreement, dealers are demanding extra premium. A re-acceleration in Azure could trigger an outsized rip; a third straight deceleration could hurt.MetaMeta is the inverse setup. Implied move of 7.3% sits below its 9.3% historical average — and Meta moved nearly 10% on its last print. That's a market that may be underpricing the tail. With 2026 capex guidance flagged at $115B–$135B, any upward revision without matching revenue commentary is the classic Meta "spend-shock" trigger. The 26% rally into the print compresses the upside and skews the risk distribution to the downside.AlphabetGoogle has the widest gap between expectation and history: a 5.75% implied move against just a 1.4% four-quarter average — roughly 4x. The options market is looking at a few things: Cloud reacceleration, search resilience against AI overviews, and Gemini monetization.The trade isn't picking a winner. It's recognizing that GOOGL has the largest implied-vs-realized dislocation, MSFT carries the highest absolute risk premium, and META has the most asymmetric tail. All three resolve within minutes of each other tonight.For exact release times:Meta was 4:01 pm ET last quarter but is usually at 4:05 pm ETGOOGL was at 4:13 pm ET last quarterMSFT usually 4:05 pm ET This article was written by Adam Button at investinglive.com.

The EURUSD is trading lower as yields push higher following the FOMC rate decision and comments from Fed Chair Jerome Powell. The move in rates is keeping the USD bid, with the 2-year yield up 9.3 basis points and approaching the 4.00% level. Meanwhile, the 10-year yield has extended further above both 4.25% and 4.00%, currently trading near 4.417%.Adding to the pressure, crude oil prices have surged sharply—up 7.15% on the day, marking the largest gain since April 2—which is reinforcing inflation concerns and helping to drive yields even higher.From a technical perspective, the EURUSD has broken below its 100-day moving average at 1.1675, shifting the bias more to the downside. The low reached 1.1662 before modest buyers stepped in, pushing the pair back toward resistance.That resistance now comes into focus at: The 200-day moving average The 38.2% retracement of the move up from the March low near 1.1681 Bias / Risk / Targets:Bias: Bearish below the 100-day MA Risk: A move back above the 200-day MA and retracement level would tilt control back toward buyers Targets: Holding below keeps sellers in control, with scope for further downside momentum If the price can reclaim those resistance levels, the downside break would start to look like a failed move—opening the door for a corrective bounce higher. This article was written by Greg Michalowski at investinglive.com.

Minutes after the Fed kept rates unchanged and had 3 dissenters to having an easing bias and with oil trading above $107, and with gas prices moving to $4.23 a gallon, Pres Trump is saying "Now is a good time to lower rates"Fed Chair Powell in his press conference says that he will stay on as a Fed Governor through his term, but maintain a low profile. Trump also says:Blockade has been genius and foolproof. Shows how food the US Navy is All Iran has to do is cry "Uncle"He said they will conduct talks by phoneSays there will never be a deal until they agree no nuclear weaponsThe WSJ reported today thatIran’s economy is under severe strain from war and blockades, with unemployment surging, inflation near 67%, and the currency hitting record lows. Basic goods are increasingly unaffordable, and businesses are shutting down across multiple sectors.The conflict has turned into an economic standoff with the U.S. Iran’s closure of the Strait of Hormuz and the U.S. naval blockade have choked off key oil revenues, with both sides betting the other will crack first.Government finances are stretched thin as revenues fall and war damage mounts. Efforts to offset the impact—subsidies, wage hikes, and alternative trade routes—have provided only limited relief.Economic hardship is at its worst in decades, raising the risk of renewed unrest and political instability. This article was written by Greg Michalowski at investinglive.com.

Powell said he will stay on as Governor for a period of time yet to be determined. He said he intends to keep a low profile. Powell said the decision was due to 'unprecedented' legal attacks and 'ongoing threats'.This is a big move and it takes away a potential opportunity for Trump to install another lackey like Miran.Powell is within his rights to stay as he's been appointed to a long term and said he will leave when he thinks it's appropriate. Normally, former Fed chairs resign their governor terms when they're done but he's not the first one to stick around."Things that happened in last 3 months left me no choice but to see them through at least that long," Powell said. Marriner Eccles was Fed Chair from 1934–1948 but he continued to stay on as a Governor until 1951 as he pushed back against government interference. The Fed's building is named after him and Powell has highlighted him as a great Chairman on many occasions. This isn't just a human interest story as it will alter the balance of power at the Fed and makes it less likely that we will be getting rate cuts. That's why the US dollar is rallying.Market pricing is now for 3 bps in hikes through year end, rising to a 50/50 chance of a cut by June 2027.Asked if the decision about Cook will affect his decision on leaving he said "not really". He also said he hasn't seen Warsh since they had dinner in January. That's a bit of a hint at a frosty relationship. This article was written by Adam Button at investinglive.com.

Sees core PCE at 3.2% for MarchSees PCE at 3.5%Near term inflation expectations have risenJobs growth slowing reflects slower labor force growthConsumer spending is resilientInflation elevated, in part reflecting energy price increaseEvery new Fed chair takes a look at communicationI don't know if the easing bias will be in the statement at the next meetingThe language was a closer call than in MarchWhat happens in the next 30-60 days could change thingsHad a vigorous debate about guidance todayMajority of committee did not want to change the language todayPeople are not saying we should hike nowPeople argue going to neutral would reflect marketsA group of people don't think we need to be in a hurry to change the language in case we need to reverse itNo one was voting for a hikeI would never be a shadow chairI respect the role of the ChairI was a Governor for six yearsThe labor market shows more signs of stabilizing while inflation is 'kind of misbehaving'I was never the biggest fan of the dot plot"You can't beat something with nothing."We are the only major central bank that doesn't publish a forecastIn his defense, Powell kept a very low profile as Governor the first time. He rarely weighed in publicly and never made waves, that's why he was a surprising pick for Fed Chair at the time.Quotable:"A group of us, including me, didn't feel like we needed to be in a hurry on [removing the easing bias]. Markets are not confused about our reaction function. The other side of the argument [to remove easing bias] is good too as I mentioned. It's perfectly good argument"Warsh has talked about getting rid of the dot plot but Powell indicated that he tried that and there wasn't broad support for it. He said that Warsh looking at communications "is the most-natural thing in the world".Another quotable:"If this goes on for much longer and prices go much higher then we'll feel that much more. I'm talking about aggregate inflation numbers. We know, we're very well aware that people are experiencing higher gas prices all over the country now. And that hurts" This article was written by Adam Button at investinglive.com.

The above image is nearly three years old and -- for me -- it will be one of the defining images of covering Powell. It was the first time I made an AI image of someone that could be mistaken for a proper news photo. It's virtually indistinguishable from a proper likeness, especially without knowing it's fake (we always label them if there could be any confusion). As you look through some of the pictures, you can see the evolution of AI image making from 'okay' to genuinely impressive.I want to highlight that picture because ultimately, his era will be remembered for the advent of AI and I think it will be the last era in a long time where AI and forecasts around it aren't what dominates all aspects of policymaking throughout all the governments of the world.All that said, here's the fun part:It's funny how the old memes were so much fun at the time (the Superman one was widely stolen from us) and now they look dated a quaint. This article was written by Adam Button at investinglive.com.