April 27 Financial Morning Report: Iran's stance is tougher than in the first round of negotiations, the probability of a Fed rate hike within the year is rising, gold price tests the 4650 level, oil price rises by nearly 2%

Forex Network April 27— (April 27, East 8th Zone) In early Asian trading on April 27, spot gold opened lower below $4,700/oz and may test the $4,650/oz level during the day. This is due to Iran taking a tougher stance than in the first round of negotiations, stating it will not participate in talks under pressure or a blockade of the Strait; the probability that the Federal Reserve will keep interest rates unchanged this week is 100%, while the probability of a rate hike later in the year has increased.

On Monday (April 27, East 8th Zone), during early Asian trading, spot gold opened lower below $4,700/oz and may test $4,650/oz during the day as Iran took an even tougher position than in the first round of negotiations, stating it would not accept talks under pressure or a blockade of the Strait. The Federal Reserve’s likelihood of holding rates steady this week is 100%, while the probability of a rate hike later this year is rising; US crude oil prices rose nearly 2%, trading near $96.15 per barrel. US media reported that Israel is "Gazanizing" southern Lebanon, while the Chairman of the US Senate Armed Services Committee requested the termination of talks with Iran and a resumption of military strikes.

Main Focus Today

Stock Market

The S&P 500 and Nasdaq indices closed at record highs last Friday, buoyed by optimism around possible US-Iran peace talks and surging tech stocks such as Intel. The Dow dropped 0.16% to 49,230.71 points; the S&P 500 rose 0.80% to 7,165.08 points; and the Nasdaq gained 1.63%, closing at 24,836.60 points. Last week, the S&P 500 and Nasdaq were up 0.55% and 1.5% respectively, posting their fourth consecutive weekly rise, while the Dow fell 0.44%.

Intel soared 23.65% to a record high of $82.57 after its Q2 revenue outlook exceeded expectations, pushing the Philadelphia Semiconductor Index higher for an 18th straight session. AMD and Arm both surged about 14%, Nvidia gained 4.32% and is approaching a $5 trillion market cap.

The market focus is turning to this week's Federal Reserve meeting. Traders currently estimate roughly a 39% probability of at least one 25 basis point rate cut in December. Strong earnings season results also support the market, with Q1 profit growth expectations upgraded to 16.1%. Gainers outnumbered decliners on both the NYSE and Nasdaq, with trading volume slightly below the 20-day average.

Gold Market

Gold prices rose last Friday, with spot gold closing at $4,721.15 per ounce, up 0.6%, though still down over 2% for the week, marking the first weekly drop in five weeks due to continued inflation worries and US-Iran tensions keeping the market cautious. June US gold futures rose 0.4%, settling at $4,740.90. Ongoing US-Iran conflicts boosted the dollar and kept inflation concerns prominent, putting pressure on gold demand throughout March; despite fewer recent military strikes, the Strait of Hormuz remains blocked, and investors are mainly led by headlines.



According to Pakistani government sources, Iranian Foreign Minister Araqchi arrived in Islamabad to discuss restarting peace talks but will not meet with US negotiators; meanwhile, Israel and Lebanon have extended their ceasefire agreement by three weeks.

A senior RJO Futures strategist stated that the market currently views the prospect of a peace deal as a net positive, and oil prices have also eased. Last week, the 10-year US Treasury yield climbed 1.5%, and the dollar posted its first weekly advance in three weeks, both raising the opportunity cost of holding gold.

Among other precious metals, spot silver rose 1.4% to $76.49, platinum gained 0.5% to $2,015.98, and palladium was up 2.2% to $1,499.75.

Oil Market

Oil prices ended last Friday mixed amid volatile trading—Brent crude futures gained 0.3% to $105.33 a barrel, while US crude futures fell 1.5% to $94.40 a barrel. Still, both benchmarks posted hefty weekly gains, with Brent up about 16% and US crude jumping nearly 13%, driven by supply disruption concerns. Oil brokers reported that traders hurried to close long positions ahead of an unusually unpredictable weekend and will readjust based on developments.



According to The Wall Street Journal, a senior Iranian diplomat stated that Iran is open to talks with the US, but will not abandon uranium enrichment activities. On the 25th, Pakistani official sources said Iran has taken a tougher stance compared with the first round of talks, emphasizing any proposal to end the war must be implemented under Iran’s terms, not those of US President Trump.

Forex Market

The US Dollar Index declined last Friday, down 0.28% to 98.55, pressured by the US Department of Justice ending its investigation into Fed Chair Powell—clearing the way for the more dovish Walsh to take over—and a market buoyed by optimism over possible US-Iran peace talks.



The euro rose 0.27% against the dollar to $1.1714, and the dollar fell 0.21% against the yen to 159.40. Federal funds futures traders raised the probability of a rate cut before year-end from 23% to 38%. Following the arrival of Iran's foreign minister in Pakistan to discuss restarting peace talks, details of the meeting remain unclear and traders remain cautious.

Market focus is shifting to the divergence in major central bank policies: The Fed is expected to keep rates unchanged this week; ECB likely holds on April 30, but most economists forecast a hike in June; the Bank of England may hold at Thursday’s meeting but markets are pricing in a hike later this year; the Bank of Japan meets Tuesday and is expected to keep rates steady but may signal readiness to tighten policy.

International News

According to CME “FedWatch”: The probability the Fed holds rates in April is 100%. Odds for a cumulative 25 basis point rate cut by June are 4.7%, and 95.3% for no change. By December, the probability of a 25 basis point rate cut is 27.4% (down from 34.4% on Friday), 64.4% for no change, and 8.2% for a cumulative 25 basis point hike (up from 0.7% last Friday).



According to Iran’s Press TV, Iranian President Pezeshkian said in a call with Pakistan’s Prime Minister Sharif that Tehran would not take part in peace negotiations under conditions of pressure, threats, or a blockade of the Strait of Hormuz. Pezeshkian reiterated Iran’s refusal to enter talks under conditions of closure or coercion. He suggested the US should remove all obstacles to restarting dialogue, including lifting the blockade on the Strait.



According to Tasnim News Agency on the 26th, Iran’s Islamic Consultative Assembly Deputy Speaker Nikzad said Supreme Leader Mujtaba Khamenei explicitly ordered that the Strait of Hormuz must not be restored to its pre-war status. (Xinhua)



On April 26 local time, Iran’s Islamic Revolutionary Guard Corps claimed its special forces had successfully destroyed three US GBU-57 giant bunker-buster bombs and dismantled another left behind in Iran’s Zanjan Province. The GBU-57 (also known as the bunker buster) is a US-developed heavy ground-penetrating bomb used in US military strikes on Iranian nuclear facilities last year, and used extensively in this year’s US-Iran conflict. (CCTV)



According to US media reports on April 24, satellite images and video show Israel carrying out systematic destruction in southern Lebanon, as it previously did in the Palestinian Gaza Strip. Israel has not only heavily damaged civilian infrastructure in southern Lebanon but is also setting up a so-called "yellow line" as in Gaza; locals trying to return past the line are reportedly shot and killed. US media claim Israel is “Gazanizing” southern Lebanon. (CCTV International News)



According to The Wall Street Journal, a senior Iranian diplomat said Iran is open to negotiating with the US but will not renounce uranium enrichment. Iran’s ambassador to India Mohammad Fathali posted on social media: “Only when our opponents recognize our right to the peaceful use of nuclear energy can talks yield appropriate results.” The report notes that the US is currently seeking a 20-year suspension of Iran’s nuclear enrichment program.



Pakistani official sources stated on the 25th that compared with the first round of talks, Iran has adopted a tougher stance, emphasizing that any plan to end the war must comply with Iran’s conditions, not those put forward by US President Trump. (Xinhua)



On the night of the 25th local time, due to a sudden security incident at the White House Correspondents’ Association dinner, US President Trump, First Lady Melania, and numerous senior US officials were urgently evacuated from the site. Soon after, President Trump held a press conference in the White House briefing room. Along with sharing some details about the security event, Trump linked the incident to the ongoing White House banquet hall construction project in the briefing and emphasized the need for an “unprecedented level of security.” Trump stated that a man armed with multiple weapons attempted to forcibly breach a security checkpoint and was subsequently subdued by several Secret Service agents. One agent was shot but survived because he wore a bulletproof vest. Before the press conference, Trump posted a photo on social media of a man lying on the floor of Washington’s Hilton Hotel, appearing to be the suspect. He also released surveillance footage showing a man running past a security checkpoint at the hotel; security staff can be seen drawing their guns, apparently firing. Trump said at the press conference that releasing the footage was to “increase transparency” and show the security personnel’s quick reaction to the shooter. Trump also mentioned the construction project of the White House banquet hall, saying that they reviewed all the specifics from that night—revealing the building isn’t particularly secure. He said he would not have brought this up, but it explains why all previously planned security upgrades must proceed. Trump added that the room in the White House is larger and much more secure, with anti-drone capabilities and bulletproof glass. Trump stated that the Secret Service and military need use of the White House banquet hall. He also stressed that, for various reasons, the Secret Service and military have wanted access to the hall for the past 150 years. But now the situation is special and requires an unprecedented level of security. (CCTV News)



According to the latest data from the US Energy Information Administration, in the week ending the 17th, US crude oil and refined product exports averaged about 12.9 million barrels per day—a record high. President Trump has repeatedly used ongoing Middle East conflicts to “market” US oil. Recently, a large number of empty tankers have entered the Gulf of Mexico. Trump posted on social media that these tankers are ready to load “the world’s highest quality, sweetest oil (and natural gas).” Experts warn that increased US crude exports are boosting energy company profits, but higher domestic oil prices will further increase inflation risks. (CCTV Finance)



US Senate Armed Services Committee Chairman, Republican Senator Roger Wicker, wrote that “the era of negotiations with Iran is over,” calling for talks to end and military strikes to resume. Wicker said that Khamenei’s heir would not honor any commitments and called for the US military to completely destroy Iran’s conventional forces and eradicate any remaining nuclear facilities, stating this is the only way to ensure long-term regional stability. On the same day, Trump said Iran was preparing to submit a negotiation plan; a US delegation led by Whitcoff and Kushner is expected to arrive in Islamabad, Pakistan, tomorrow.

Domestic News

According to Three Gorges Group, the unit with China’s largest single-unit capacity at the pumped storage power station—Zhejiang Tiantai Pumped Storage Power Station’s No. 3 unit—has successfully started operations, paving the way for the plant’s full-capacity launch in June. The Zhejiang Tiantai pumped storage power station, with a total installed capacity of 1.7 GW, includes upper and lower reservoirs, water conveyance systems, and underground plant rooms. The station is fitted with four reversible pump-turbine generator units, each rated at 425,000 kW—not only the largest single-unit capacity among similar projects globally under construction; the station also features a fixed water level difference of 724 meters between the reservoirs, the highest for a pumped storage station currently under construction. (CCTV)