2026-04-07 Tuesday
2026-04-10
19:50:11
[GC Opens Weak at 3.67%, $44 Billion Cash Injection Combined with Safe-Haven Demand, Overnight Rate May Fall Below Midpoint of Interest Rate Corridor] ⑴ Due to the inflow of $44 billion in cash into the system from Treasury bill settlements, GC opened 2 basis points weaker at 3.67% bid. The additional cash, coupled with funds generated by safe-haven strategies, may push overnight rates below the midpoint of the 3.50% to 3.75% interest rate corridor. ⑵ Institutions point out that the overnight collateral market is a safe haven in the current environment, so a sharp drop in GC should not be surprising. Federal funds futures price a 3% probability of a 25 basis point rate hike at the June FOMC meeting, and 0x3 OIS prices a 6% probability of a 25 basis point rate hike within the next 90 days. ⑶ From a psychological perspective, the market is waiting for a ceasefire agreement to emerge at 8 PM Beijing time on Tuesday. SOFR futures are fluctuating between a 0.5 basis point decline and a 1 basis point increase. If no agreement is reached before the deadline, safe-haven funds will further flow into the overnight collateral market, pushing GC and repurchase rates lower.
19:46:12
[Another Deadline Approaching, Market "Whistling in the Dark," Selling on Rallies is a More Prudent Strategy] ⑴ Institutions point out that the macro market is facing yet another deadline. The market may have become numb due to repeated extensions, seemingly whistling in the dark. However, the positions of the US and Iran are vastly different, and Trump is clearly weighing whether to adopt a scorched-earth strategy. If the Democrats win the House of Representatives, war crimes charges will become the focus. ⑵ Institutions still believe that special forces will enter and control Kharg Island and three other key islands in the Hormuz region. Kharg's military and radar facilities were destroyed in early strikes. Taking these islands will create a scorched-earth threat; destroying power plants and energy infrastructure constitutes a general's move. (3) From a trading psychology perspective, the tactical preference is two-way range trading, but selling during rebounds is more prudent. The 10-year US Treasury yield is expected to be between 4.32% and 4.36%. The market may think it is ready to face whatever comes next, but institutions are skeptical. In a scorched earth scenario, crude oil is expected to reach $150, the 30-year US Treasury yield to 5.25%, and the S&P 500 to 5600.
19:36:31
[Malaysian Prime Minister Says Middle East Conflict Spillover Effects Affect Southeast Asian Economy] Malaysian Prime Minister Anwar Ibrahim said in Kuala Lumpur on the 7th that the spillover effects of the Middle East conflict have begun to affect the global economy, including Southeast Asia. He urged countries to persist in using diplomatic means to de-escalate the situation while accelerating energy structure transformation to enhance economic resilience and the ability to cope with external shocks. Speaking at the Kuala Lumpur-Ankara Dialogue, Anwar said the continued turmoil in the Middle East has had a wide-ranging impact on global energy supply, supply chain stability, and people's livelihoods. The international community should oppose unilateral military action and uphold the rules-based international order. Anwar warned that the continued disruption of shipping in the Strait of Hormuz will have a profound impact on the global production system and market stability. He said, "The oil crisis of the 1970s was not only an energy shock, but also exacerbated inflation, suppressed growth, and reshaped the global economic landscape. Today, the risks are more complex; the (global) economy is highly integrated and digitalized, and more dependent on the stability of supply chains." He stated that these risks could trigger systemic shocks, disrupt markets and damage supply chains, putting pressure on global economic stability. "In the long run, we must accelerate the transformation of our energy strategy and move towards a more sustainable, diversified, and cost-effective energy system." (Xinhua)
19:31:35
[Trump's Deadline: Airstrikes, Agreement, or Bluffing? A Crossroads is Imminent] ⑴ Trump set a deadline of 8 PM Beijing time on Tuesday, warning that if Iran does not reopen the Strait of Hormuz, he will bomb its critical infrastructure. Based on past behavior, three outcomes are possible: a low probability of backing out, but this would weaken his leverage; a delay with claims of progress in negotiations to maintain pressure; or believing Iran is stalling and launching an immediate or phased airstrike. ⑵ From a trading psychology perspective, the market is currently pricing in all three scenarios simultaneously. However, the "backing out" option has the lowest probability, meaning the geopolitical risk premium is unlikely to subside, while "delay" only provides a brief respite. Once an actual airstrike occurs, crude oil, Treasury bonds, and safe-haven currencies will face instantaneous and drastic repricing. ⑶ Bloomberg Economics research has previously listed limited airstrikes as the most likely path. Indirect negotiations between the US and Iran have stalled, with neither side softening its stance. Whether Trump resorts to pressure, diplomacy, or military action will determine the direction of the global energy market in the coming weeks.
19:28:57
[US-Iran Indirect Negotiations Stalled, Ceasefire Prospects Dim] ⑴ Indirect negotiations between the US and Iran are ongoing, but progress toward a 45-day ceasefire agreement remains limited. Iran refuses to exchange reopening the Strait of Hormuz or abandoning uranium enrichment for a temporary ceasefire, instead seeking a permanent ceasefire while retaining control of the strait. ⑵ From a psychological perspective, the market may have already partially priced in a compromise of a "temporary ceasefire for navigation," but Iran insists on a permanent ceasefire and demands to share transit fees with Oman. Meanwhile, Tehran doubts that negotiations can prevent US-Israeli attacks, meaning any short-term agreement is unlikely to truly eliminate the risk of supply disruptions. ⑶ Neither side has softened its stance. Officials say negotiations have entered a critical phase, while Trump has warned that if the strait is not reopened, he will immediately strike Iranian infrastructure. The longer the stalemate continues, the more firmly the energy market prices for long-haul routes and high insurance premiums will solidify.
19:12:58
[US-Israeli attack on Iranian railway bridge kills 2, Ahvaz targeted by airstrike, escalating tensions along Middle East energy corridor] ⑴ Officials in Iran's Isfahan province said on Tuesday that the Yahyaabad railway bridge in Kashan was attacked by the US and Israel, resulting in 2 deaths and 3 injuries. Later that afternoon, parts of Ahvaz in Khuzestan province were also targeted by airstrikes, with targets in the Zeitun area and along national highways. ⑵ From a trading psychology perspective, the railway bridge attack directly threatens Iran's inland logistics hubs. Khuzestan province, where Ahvaz is located, is a major energy-producing region in Iran, and the airstrikes in this area further amplify the potential risk of disruptions to crude oil and natural gas transportation. ⑶ The market had already priced in a potential blockade of the Strait of Hormuz, but the attack's spread to Iran's deep infrastructure indicates an expanding geopolitical conflict. Any trade flows reliant on Middle Eastern energy exports may face longer transit times and higher insurance premiums.
19:07:50
[Kharg Island, Iran, Attacked Again; Multiple Explosions Reported] Reporters learned from Iranian sources on April 7 that Kharg Island, Iran, was attacked again, with multiple explosions reported. The US Central Command stated on March 14 that the US military conducted a large-scale strike on Kharg Island on the evening of March 13, successfully striking more than 90 military targets on the island. The US destroyed Iranian naval mine storage facilities and missile storage bunkers, but "preserved" the oil infrastructure. Kharg Island, a key Iranian oil export hub located in the northwestern Persian Gulf, approximately 25 kilometers from the Iranian coast, is Iran's largest crude oil export base, with 90% of Iran's crude oil exported from there. (CCTV News)
19:05:58
[Global Rush to Buy Russian Energy, Kremlin: Market Demand "Explodes," Europe Cuts Off Cheap Supply] ⑴ The Kremlin stated on Tuesday that amid a severe global energy crisis impacting the foundations of the oil and gas market, there is a massive demand for Russian energy, and Russia is negotiating in a manner most in its own interest. ⑵ Institutional data shows that last month, the premium of Russian Urals crude over Brent crude reached $5 to $8 per barrel, contrary to the usual discount, reflecting that Asian countries such as Vietnam, Thailand, the Philippines, Indonesia, and Sri Lanka are queuing up to buy Russian oil. ⑶ From a psychological perspective, the market had previously generally bet that Russian oil would be forced to liquidate at a discount, but the current premium structure is forcing short covering.
18:42:12
[Trump Issues Ultimatum to Iran, Four-Hour Destruction Plan Emerges] ⑴ Trump reiterated that his Tuesday deadline for an agreement with Iran is the final deadline, stating that Iran's proposal is significant but not good enough, and expressing a desire for a swift resolution. He said the US could withdraw troops immediately but wants to finish the job. ⑵ Trump stated that the US is destroying Iran, threatening to attack bridges and power plants, saying Iran will have no bridges, no power plants, nothing, and implying that if given the choice, they would take the oil. ⑶ At a press conference, Trump stated that the US military has developed a plan to completely destroy every bridge in Iran and completely paralyze every power plant within four hours, from 8 PM to midnight Eastern Time on April 7th. ⑷ Trump declared that if freedom is ultimately achieved, the Iranian people will be willing to endure the suffering caused by attacks on civilian energy and infrastructure, and stated that he is not at all worried about being charged with war crimes. ⑸ Israeli officials revealed that Netanyahu urged Trump not to seek a ceasefire for the time being during a phone call with him on Sunday, expressing concern about the potential risks of such a move.
18:34:12
[India's Gas Cylinder Shortage Devastates Food and Beverage Industry, Sugar and Cooking Oil Demand Both Decline] ⑴ A shortage of commercial gas cylinders in India has forced restaurants to scale back operations during the summer peak season, leading to a decline in the country's sugar and cooking oil consumption. Roadside restaurants and other establishments are facing cylinder shortages, reducing their cooking oil usage. ⑵ The executive director of the Solvent Extractors Association of India stated that India's cooking oil imports in March fell by nearly 9% month-on-month to 1.2 million tons. The decline in consumption may suppress India's imports of palm oil from Indonesia and Malaysia, as well as soybean oil and sunflower oil from Argentina, Brazil, Russia, and Ukraine. ⑶ A roadside restaurant owner stated that they were unable to operate last week after running out of gas. Although they received a cylinder this week, they expect it to last no more than ten days, even though a cylinder ordered three weeks ago has not yet arrived. ⑷ India, the world's second-largest importer of liquefied petroleum gas (LPG), is facing its worst gas shortage in decades. The government has cut industrial gas consumption to ensure household supply, and approximately 90% of imports come from the Middle East. (5) A senior official from the National Cooperative Sugar Mills Federation revealed that the gas shortage has also dampened the sugar demand that usually rises in the summer, with many roadside tea stalls and dessert shops scaling back operations or temporarily closing.
18:33:02
[Raw Sugar Falls to Three-Week Low, Energy Prices Support Limited Downside] ⑴ ICE raw sugar futures fell 1.3% to 14.77 cents per pound on Tuesday, hitting a three-week low of 14.69 cents during the session, a significant pullback after reaching a five-month high of 16.10 cents at the end of March. ⑵ Traders said further downside appeared limited as high energy prices could prompt countries like Brazil to use sugarcane more for ethanol production than sugar, providing support to the market. ⑶ The market was also supported by the El Niño weather pattern, which is expected to result in below-normal rainfall in India's 2026 monsoon season, potentially suppressing sugar production and leading to a global supply gap in 2026/27. ⑷ London cocoa fell 2.6% to £2,395 per tonne, with traders citing continued weak demand and expectations that first-quarter grinding data from Europe, North America, and Asia, to be released later this month, would show year-on-year declines. (5) Arabica coffee fell 2% to $2.9220 per pound, and Robusta coffee fell 1.3% to $3,402 per tonne.
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