Another day, another deadline

0:00Today, oil prices are on track for their steepest weekly fall for six months. After President Trump extended a deadline for strikes on a run for 10 days. And SpaceX could file for a record-breaking IPO any day now. This is Reuters Morning Beats bringing you unfiltered market news and analysis straight from the Reuters newsroom seven days a week. I'm Peter Devon in London. And I'm Elena Cassas. It's Friday, March 27. So Peter, oil prices look like they're on track for their steepest weekly fall in six months. After President Trump last night extended a deadline for airstrikes on Iran's energy plums. For another 10 days, that's until April the 6th. That announcement came after the close on Wall Street, which did clock up its steepest fall since the start of the war in Iran. The S&P closed down 1.7% and the Nasdaq confirmed a correction. So that's perhaps not unconnected to Trump's announcement, is it? Well, maybe a sigh of relief, but maybe more just a moment for the market to really just

1:01take the breath and take a breather. I mean, you're right, look at yesterday's moves, the steepest drop since January. And generally, that was because the press conference from President Trump yesterday seemed more like a precursor for a mass invasion rather than any sort of peace talks. And the markets are looking at these peace talks with a bit of a sketchy eye. So really, this decision today just seems like kicking the can down the road. We know that President Trump is very sensitive to what Wall Street does. I read this week that Deutsche Bank traders have created a so-called TACO index, a Trump chickening out index, where they've put in his current popularity ratings, the average price of gas at the pump, US Treasury yields, and the performance of the S&P to try and calculate when exactly President Trump might do a U-turn. And that just shows how difficult traders are finding it, to figure out what's coming next from government policy and therefore price in what might happen to oil. Well, let's use President Trump's words here. He said yesterday when he was asked about the deadline that a day is an eternity. And I think that's how traders are looking at it. No, they've got 10 days to win through masses of headlines. I mean, we've already seen some that this is just a delay tactic

2:01to maybe add more trips to the Middle East preparing for who knows what. So there's a minefield out there, and that's what's really hurting traders. Well, if it is a delay, that's not really what they're pricing, isn't it? At this oil price, it still looks like oil traders are assuming a relatively quick resolution. Macquarie said that prices could fall very quickly, if the stage of farmers is opened up. But it's still an enormous if and they said in the same research note that $200 a barrel is still very possible if the war continues until the end of June. Well, you've hit the knee on the head. There is all comes down to the street of Ramos and all these entry energy infrastructure in the Gulf is still looking a bit risky. So there's still lots to be wary of. 11 million barrels a day are being taken out of supply by the closure of that straight. That's really significant. Asian countries are starting to run down their reserves. And as you say, what could change everything is further airstrikes on energy infrastructure and they got all further damage? We have seen some, of course, with the Cotari LNG facility that was hit by drone strikes but any more significant damage to energy facilities themselves could have a huge impact.

3:02Well, let's look at maybe some of the warnings we got this week, some big closer to home ones about recessions. Moody's said that there are probability of recession over the next years, raised to 49%. Now, usually about a throughout a 12-month period, the probability is about 20%. But this is the highest it's been for years and they really note that if oil prices stay as high they are right now, maybe to run Memorial Day for our non-uslisters, that's about the 25th of May, or even to the end of the second quarter, the US is looking into recessions. This is really hurting. Certainly inflation forecasts are moving up across the developed world. Fed cover and Elisa Cook said yesterday that the risk is very much tilted to the upside in terms of inflation. And that will only increase predictions that the Fed will be obliged to height-rate this year, which, as you say, could have quite damaging consequences to the US economy, given that the job market already looks precarious. Well, let's look at those Fed comments there. As you said, Elisa Cook, but we all started from Jefferson and Barr noting about the risk inflation and those concerns are just getting lighter. Barr and Jefferson, as well, saying that they're looking at a hold knife from the Fed for a certain time period.

4:04And that came in through from Reuters poll this week, economists still seeing a hold to bite September, but maybe holding on hopes for a cut still. So it does seem to this be two voices emerging, economists and analysts may be saying this is transitory, which is a complete flip from what we saw on the Russian Ukraine crisis in 2022. Well, amid all this around us, Peter, we shouldn't miss out on another big story that could break in the next couple of days. SpaceX has expected to file for an IPO potentially before the end of March, which is expected to be the biggest in history. It's set to value the company at $1.75 trillion. That will be huge for the market, wouldn't it? So Elon Musk is hoping to raise around $75 billion per year. Let's look at the last record. It was about $30 billion from Sorodio Ramco in 2019. So he really wants to smash that record. Let's look at the pitch deck here. SpaceX is dominating the commercial space industry. But there are some critics here a bit skeptical, though they worry that funds could be a siphoned off towards XAI, so there are some worries still there. It's interesting that as much as 30% of these shares are expected to be made available to retail investors, a normal amount for an IPO would be more like five to 10%.

5:07So Elon Musk is really relying on his own personal fan base to buy up these shares. It's very much a vote of investor confidence on the man himself, this IPO, isn't it? When your options are limited, so are your opportunities. At SIBO, the global exchange that pioneered options trading, we offer more ways to move with the market. From VIX and SPX options to global market data solutions, SIBO helps investors diversify, manage risk, and stay ahead of whatever the market does next. SIBO, life is better with options. Your investments could be too. There are risks associated with SIBO company products. Review the disclosures and disclaimers at SIBO.com slash US underscore disclaimers. And for today's recommended read, check out Jamie McGeevers' column on why, despite the war, oil price swings and all the uncertainty. US stocks may actually deserve a more bullish outlook right now. We'll drop a link in the description. And for more of any today's stories, hit the rotors.com

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