Oil Shock Sets Up Inflation Test as Markets Eye CPI, PCE Data This Week

Key highlights:

• At the Asian open on Monday, oil climbed, bonds fell, and stocks were mixed as Trump warned of “hell” if Iran misses his Strait of Hormuz deadline.
• Oil rose at Monday’s open after the Easter weekend as the U.S.-Israeli conflict with Iran continued to disrupt global supply.
• The dollar held steady Monday as the yen hovered near the key 160 per dollar mark amid nervous reaction to escalating Iran tensions and President Trump’s Strait of Hormuz deadline.
• Benchmark Japanese yields hit a 27-year high as Middle East war stokes inflation fears and stronger U.S. jobs data dims hopes for early rate cuts.
• fell on Monday, pressured by a stronger dollar as elevated oil prices from the prolonged Iran war and stronger U.S. jobs data dented hopes for Fed rate cuts.

Dow Jones futures edged up Sunday night, while S&P 500 and Nasdaq futures rose modestly as investors stayed cautious amid new U.S.–Iran developments and climbing oil prices.

The S&P 500 gained in the holiday-shortened week, ending a five-week losing streak. The index had earlier finished its worst quarter since 2022 after late-February losses tied to the war and surging energy prices, but the market rebounded last week even as crude continued to climb. All three major indexes snapped five-week losing streaks, each finishing up at least 3%.

Stocks have struggled this year as AI disruption worries and weak private credit add to Middle East conflict uncertainty; the S&P 500 is about 6% below its late-January record.

US Economic data and Earnings Calendar:

Investors will watch Friday’s March expected to show a 0.9% monthly gain as an early test of the war-driven energy shock. U.S. crude is up about 90% year-to-date, pushing the national average gasoline price above $4 a gallon for the first time in over three years.

Thursday’s release of Personal Consumption Expenditures data, another inflation gauge seen as central to the Federal Reserve’s interest-rate planning.

Economic calendar:

Monday, 04/06

• Trump press conference, Oval Office, 1:00 p.m.

Tuesday, 04/07

• Chicago Fed President Austan Goolsbee live Q&A (Detroit), 12:35 p.m.

Wednesday, 04/08

• Fed minutes from the March meeting released, 2:00 p.m.

Thursday, 04/09

• Personal Consumption Expenditures () report for February.

Friday, 04/10

• Consumer Price Index () for March, 8:30 a.m. (economists expect +0.9% month-over-month).

Earnings calendar:

Wednesday, 04/08

• reports Q1 results before the open, Constellation Brands (NYSE:STZ) reports fiscal Q4.

Delta’s earnings have been uneven recently, typical for the cyclical airline industry where fuel, labor and consumer spending swings drive volatility. The carrier has fared better, serving higher-income travelers less affected by inflation, even as main-cabin demand softened. In Q4, main-cabin ticket revenue fell 7% to $5.62 billion, while premium ticket revenue rose 9% to nearly $5.7 billion.

Delta shares reacted modestly to its Jan. 14 Q4 report: adjusted EPS fell 13% year-over-year to $1.55, beating estimates by $0.02, while revenue rose 3% to $16 billion. Management forecasts FY adjusted EPS of $6.50–$7.50 (midpoint $7.00 vs. analysts’ $7.25) and Q1 adjusted EPS of $0.50–$0.90 (midpoint $0.70 vs. Street at $0.72).

Technical Analysis:

DJIA Index

• Dow Jones (DJI) broke above a falling channel last week; that channel now supports near 45,760.
• Holding above 45,760, expect a rally toward 47,430, then a corrective pullback.
• A decisive break above 47,430 would open the path to ~48,400.
• The index retested and bounced off the prior all-time area around 45,000—a healthy sign within the uptrend.

• Nasdaq rebounded from the 23,000-support noted in previous report.
• Must hold above 23,990 to target 24,330 this week.
• Rejection at 24,330 would likely send it back to 23,000.
• Expect NDX to trade between 24,330 and 23,000 until a breakout occurs.