Pre‑Market
Briefing

Strait of Hormuz Crisis Maximum Escalation

The United States declared a naval blockade of all Iranian ports on Sunday after 21 hours of talks in Islamabad ended without a deal. CENTCOM confirmed the blockade begins Monday at 10:00 AM ET and applies to all maritime traffic entering or exiting Iranian ports in the Arabian Gulf and Gulf of Oman. Vessels transiting the strait to and from non-Iranian ports will not be impeded — a critical clarification that softened the initial market reaction somewhat. US naval destroyers had already entered the strait on Saturday for mine-clearing operations for the first time since the war began.

Iran’s response was immediate and threatening. The IRGC stated any approaching military vessels near the strait would be considered a ceasefire violation and “met with severe force.” Iran’s foreign minister said negotiators were “inches away” from an agreement but encountered “maximalism, shifting goalposts, and blockade.” Parliamentary speaker Ghalibaf posted a map of Washington-area gasoline prices with the warning: “Enjoy the current pump figures. With the so-called blockade, soon you’ll be nostalgic for $4–$5 gas.” The Eurasia Group noted that the blockade would keep tanker volumes below 10% of pre-war levels, maintaining continuous upward pressure on oil prices.

Helima Croft at RBC Capital Markets noted Sunday that Trump “may be calculating that China will become more active in negotiations if it faces a cutoff of Iranian cargoes to its refineries” and warned that Tehran may increase attacks on regional energy facilities if Trump backs up the blockade threat with military action. The Wall Street Journal separately reported Sunday that Trump and his advisers are considering resumption of limited military strikes on Iran to break the peace talk stalemate, though a full-fledged bombing campaign is seen as unlikely given the president’s stated aversion to prolonged operations. Pakistan, which hosted the talks, said it is still trying to bring both parties back to the table within days.

Supply Countdown April 20 Cliff

The JPMorgan commodities desk published a critical note Sunday: “Reopening the Strait has become the market’s most time-sensitive priority. The last tanker to clear Hormuz on February 28 is expected to reach its destination around April 20, marking the point at which pre-closure barrels are fully exhausted from the global supply chain.” Only 24 ships passed through the strait last week. On Friday, just two ships passed — neither was an oil or gas tanker. The IEA head Fatih Birol described the disruption as the worst energy shock the world has ever seen, more severe than the oil crises of the 1970s and the Ukraine war combined. Saudi Arabia has restored full pumping capacity through its east-west Red Sea pipeline, providing a partial alternative route, but the volumes involved cannot replace Hormuz flows at scale.

US WTI crude exports are running at approximately 4.2 million barrels per day in recent weeks per preliminary federal data — a record pace. Trump publicly urged China and other countries to buy US oil instead, framing the blockade as a commercial opportunity for American producers. But global refinery configurations are not interchangeable: Asian refineries are designed for Middle Eastern crude grades, not US light sweet. The swap is not straightforward at any scale approaching what the strait normally handles.

Equity Strategy Desk Synthesis Earnings vs. Energy

The ceasefire rally that drove the S&P 500 to approximately 6,824 on Friday April 11 — its strongest weekly gain of 2026 at roughly 3.5% — is being unwound this morning on the blockade announcement. Tom Lee of Fundstrat had called the market bottom on April 8 following the ceasefire, raising his year-end S&P 500 target to 7,300 and noting that “stocks rose even as the Iran war got worse” during the preceding week — a technical strength signal. That call is now being tested on its first trading session. Ed Yardeni had lowered his recession probability estimate back to 20% from 35% on the ceasefire, but warned explicitly that “a two-week pause is not a resolution” and that markets would remain sensitive to any breakdown in talks. That breakdown has now materialized.

Mike Wilson of Morgan Stanley published his April 6 podcast characterizing the market as entering the “final innings of the equity market correction” and outlined a binary scenario framework: de-escalation puts oil at $80–$90 with markets recovering toward year-end targets; sustained disruption pushes oil to $100–$150+ with nonlinear demand destruction and a fundamentally different portfolio construction requirement. With WTI at $104 this morning, the market is operating at the boundary of those two scenarios. Jonathan Krinsky at BTIG flagged in early April a bullish VIX divergence — the index failing to make a new high while the S&P briefly dipped below March lows — as a technical setup similar to January’s pre-rally conditions. That signal now faces a re-test.

Michael Hartnett / Bank of America Flow Show — April 10

Hartnett’s latest Flow Show, published April 10, identified the dominant structural theme for the second half of the 2020s as a rotation from US dollar and large-cap US stocks toward commodities, international equities, and small-cap stocks. Six structural shifts drive this view: globalization turning toward nationalism, efficiency prioritization giving way to livelihood prioritization, the Federal Reserve moving from independence to compliance, the US transitioning from open borders to controlled borders, AI arms race evolving into disruption, and the US service sector pivoting to manufacturing. The BofA Bull & Bear indicator stands at 6.3 (neutral, sell signal ended March 25). Hartnett noted the April fund manager survey — due Tuesday — as a key sentiment reference point. Global flows showed equities seeing record year-to-date inflows, though the most recent week saw $29 billion in equity outflows, the largest in 13 weeks.

The Kobeissi Letter April 12 — Dual Alert

Two critical alerts published Sunday. First: JD Vance announced US-Iran talks ended after 21 hours without agreement — described as “bad news for Iran, much more than it is bad news for the US.” Second: private credit redemption requests hit a record $14 billion in Q1 2026, up 146% from Q4 2025 and up 278% from the full year 2024. Blue Owl Capital was hardest hit, with investors requesting withdrawals of 41% from its technology-focused fund and 22% from its flagship credit fund. Half of all redemption requests were met, leaving approximately $7 billion in unmet redemptions — the largest backlog on record. The private credit stress dimension, which pre-dates the war, continues to compound alongside the geopolitical binary.

Citadel Securities — April Update Retail Positioning Shift

Citadel Securities’ April retail flow update identified Q1 2026 as the second-largest quarter of net retail buying on their platform, behind only Q1 2021. Average daily notional traded was approximately 3.3 times historical levels. However, retail tone has recently softened: the prior week saw the first net-selling week since November 2025. Retail positioning has turned contrarian — selling into rallies and buying on weakness — a clear departure from January and February’s one-directional buying behavior. The macro setup for Q2 earnings, what the firm calls the “Super Bowl” of the season, lands in the final week of April with large-cap technology driving index-level outcomes.

Moody’s Analytics / IMF Stagflation Signal

Moody’s chief economist Mark Zandi characterized the current environment as “directionally, stagflation” in commentary surrounding the March CPI report, which showed headline inflation jumping to 3.3% year-over-year from 2.4% in February — the first CPI report to fully capture the Hormuz disruption. Moody’s Analytics places recession probability near 50%. The IMF released its World Economic Outlook analytical chapters on April 8 with the main chapter due tomorrow Tuesday at 9:00 AM ET, which will provide the IMF’s first comprehensive global growth and inflation forecast incorporating the Hormuz shock. The IMF managing director previously stated that “all roads lead to higher prices and slower growth.” Central banks across the developed world are being forced to choose between addressing demand destruction from energy costs or fighting persistent inflation from the same source — a classic stagflationary policy trap.

Featured CallJonathan Krinsky, CMT — BTIG Chief Market Technician April Setup

Krinsky published his April technical note in early April identifying a constructive divergence: the VIX failed to make a new high while the S&P briefly dipped below its March lows, a pattern that preceded the January relief rally. March closed with a decline of over 6% in the S&P 500, the worst monthly performance since September 2022 and the most challenging March since the pandemic-hit 2020. Historical analysis shows that such weakness often precedes spring strength — April has historically been one of the strongest months for US equity markets, finishing higher 80% of the time over the past 20 years according to Carson Group data. Krinsky remains cautious on medium-term trends but characterized the April seasonal setup as leaning bullish. The VIX divergence signal he flagged is now being re-tested on Monday’s blockade-driven open.

Options Market Structure Negative Gamma Territory

VIX at 21.32 premarket, up 10.87%, signals re-engagement of negative gamma dynamics. SpotGamma had previously identified negative gamma “trapdoor” conditions as the structural driver of geopolitical shock amplification in the equity options market. In negative gamma environments, dealer hedging flows are pro-trend: as markets fall, dealers must sell more, amplifying declines. The S&P 500 had reclaimed positive gamma territory during last week’s ceasefire rally, with local positive gamma pockets near SPX 6,800 and 6,900. Monday’s open threatens to push back below key gamma levels, reactivating the destabilizing feedback loop.

The AAII Sentiment Survey published April 10 showed bullish sentiment at 35.7%, up 2.2 percentage points week-over-week, but still below its historical average of 37.5% for the eighth consecutive week. The Seeking Alpha Wall Street Brunch published Sunday noted that the Fed Beige Book and key Fed speakers — Williams and Waller — will be closely monitored this week for the rate-outlook framework given the blockade’s additional inflationary impulse.

Blockade & Iran Response Live As of 6AM ET

Tanker traffic through the Strait of Hormuz ground to a halt within hours of Trump’s Truth Social post Sunday, according to Lloyd’s List Intelligence. At least two vessels that appeared to be heading for the exit turned back. Three tankers were attempting to transit Sunday evening by sailing close to the Iranian coast — the first vessels to try passage since the blockade was announced. Iran’s armed forces issued a statement that “no port in the Persian Gulf and the Sea of Oman will be safe” should the blockade take effect. Iran called the action “piracy.” The IRGC said it will not allow US ships to pass through Hormuz and will protect its territorial waters. Pakistan continues active mediation efforts. Australia said it received no request to participate and is not joining the blockade. UK also announced it is not participating.

WSJ Exclusive — Limited Iran Strikes Under Consideration Sunday Reporting

White House advisers are considering resuming limited military strikes in Iran alongside the blockade to break the stalemate in peace talks, the Wall Street Journal reported Sunday citing officials and people familiar with the situation. A full-scale bombing campaign was described as less likely given the risk of further destabilizing the region and the president’s stated aversion to prolonged military conflicts. Trump could also seek a more temporary blockade while pressuring allies to assume responsibility for a longer-term naval escort mission through the strait. The Justice Department’s acting attorney general posted on social media that the DOJ “will vigorously prosecute anyone who buys or sells sanctioned Iranian oil.”

Macro Signals — Breaking Premarket April 13 AM

Oil surged back above $100 a barrel while stocks fell and bonds edged lower after Trump ordered the blockade following the weekend deadlock, per Bloomberg Markets Live. Brent jumped 7.9% to nearly $103 per Bloomberg, while WTI crude climbed as much as 9.3% to above $105. European gas futures spiked up to 18%. The dollar rose 0.3%, its biggest gain in more than a week. Gold traded moderately lower near $4,710 — unusual risk-off behavior suggesting some gold positions are being liquidated alongside broader de-risking. Two-year Treasury yield up 3 basis points to 3.82%. Dow futures dropped more than 500 points in early trading before recovering partially. Earlier-week predictions for a calm bank-earnings week have been overtaken entirely by events.

Seeking Alpha Wall Street Brunch Published April 12

The Sunday edition led with: “Earnings Arrive Amid Hormuz Standoff.” Key framing: Q1 earnings season opens with major banks setting the tone for market sentiment; Netflix earnings Thursday focus on ad revenue traction, live sports, and pricing power after recent subscription hikes; geopolitical risk rises as US threatens to block Hormuz following failed Iran talks; Fed Beige Book and Williams and Waller identified as key voices on rate outlook this week.

Seeking Alpha Wall Street Week Ahead Published April 12

Earnings calendar highlighted: Goldman Sachs today; JPMorgan, J&J, Wells Fargo, Citigroup Tuesday; ASML, Bank of America, Morgan Stanley Wednesday; Taiwan Semiconductor, Netflix, PepsiCo Thursday. Newsquawk Week Ahead noted S&P 500 earnings growth expected at 13.2% year-over-year for Q1, marking the sixth consecutive quarter of double-digit EPS growth. Revenue growth of 9.7% year-over-year forecast, highest since Q3 2022. All 11 GICS sectors projected to report revenue growth, led by technology, communications, and financials.

Benzinga Pre-Market Published April 13 — Live

Multiple live articles tracking the blockade. Iran’s parliament speaker warned Americans to “enjoy” current pump figures as Trump orders Hormuz blockade. WTI crude surged to $103.54, up 7.22% in premarket. US average gas price $4.125 per gallon, up from $3.598 one month ago. Polymarket prediction markets for the week of April 13 leaning toward a lower S&P 500 open based on blockade news and failed talks.

Bloomberg Markets Live Live April 13

Monday wrap published premarket: oil surged back above $100 a barrel, stocks set to fall 0.6% at open, bonds edged lower. Brent jumped 7.9% to nearly $103. Dollar +0.3%, its biggest gain in more than a week. Separately, Bloomberg reported three tankers attempting to transit Hormuz by sailing close to the Iranian coast — first vessels to try since blockade announcement. The Bloomberg tanker tracking desk flagged that ship transits remained at greatly reduced levels Sunday as most vessel owners remained reluctant to operate in the waterway.

March FOMC Minutes — Released April 8 Hawkish Pivot Confirmed

The March 17–18 FOMC minutes, released April 8, showed that “the vast majority” of officials expected inflation progress to be slower than anticipated, driven by three overlapping concerns: tariff effects on goods prices that may take longer to fade, oil prices bleeding into core inflation, and the risk that years of above-target inflation could de-anchor long-term expectations. The Fed held rates at 3.50–3.75%. The median official projects one rate cut in 2026 — but the range of views is unusually wide, with at least one official seeing four cuts and a vocal contingent seeing potential rate hikes if inflation stays sticky. CME futures now price zero rate cuts for 2026. Next FOMC meeting: April 29.

NY Fed President John Williams April 7 Bloomberg Interview

Williams told Bloomberg that his outlook for underlying price pressures was “largely unchanged” despite higher energy costs. He projected core inflation would rise by only 0.1 to 0.2 percentage points due to oil pass-through — the story around underlying inflation “hasn’t changed very much.” He lowered his 2026 GDP forecast to 2.0–2.5% from 2.5–2.75% and characterized monetary policy as “really well positioned to wait and see.” Williams placed headline inflation for the year at approximately 2.75%, with energy prices as the swing variable. His comments came before Sunday’s blockade announcement, which adds a fresh inflationary impulse beyond what he was modeling.

Wells Fargo Investment Institute Bond Market Commentary — Apr 9

The Institute’s bond market commentary as of April 9 showed the 10-year yield at 4.28% and the 30-year at 4.88%. Futures markets were pricing in no policy rate change at the next FOMC meeting. The Institute maintained its 2026 base case of above-average US economic growth and S&P 500 record earnings, characterizing energy price disruption and private credit stress as the two dominant near-term risks. The broader strategic message: basic portfolio diversification remains the preferred positioning during periods of divergent macro risks.