Markets tumble while traders await Israel's response to Iran's attack

Dow sank 248 (650 below opening levels), decliners over advancers a hefty 6-1 & NAZ retreated 290.  The MLP index was off 3 to the 284s & the REIT index sank 6 to the 359 while interest rates rose.  Junk bond funds drifted lower as bond yields rose & Treasuries were heavily sold raising yields sharply.  Oil finished little changed in the mid 86s & gold jumped 20 to 2394 (more on both below).

AMJ (Alerian MLP Index tracking fund)

Goldman Sachs (GS), a Dow stock, posted first-qtr profit and revenue that topped expectations, fueled by a surge in trading & investment banking revenue.  EPS jumped to $11.58 from the year earlier period, thanks to a rebound in capital markets activities & revenue rose 16% to $14.2B, topping estimates by more than $1B.  Fixed income trading revenue rose 10% to $4.3B, topping the estimate by $680M, thanks to a jump in mortgage, foreign exchange, & credit trading & financing.  Equities trading climbed 10% to $3.3B, about $300M more than expected, on derivatives activity.  Investment banking fees surged 32% to $2.1B, topping the estimate by roughly $300M driven by higher debt & equity underwriting.  “I’ve said before that the historically depressed levels of activity wouldn’t last forever,” CEO David Solomon said.  “CEOs need to make strategic decisions for their firms, companies of all sizes need to raise capital, and financial sponsors need to transact to generate returns for their investors... It’s clear that we’re in the early stages of a reopening of the capital markets.”  The stock rose 11.46 (3%).

Goldman Sachs tops first-quarter estimates fueled by trading, investment banking

Apple (AAPL), a Dow stock, iPhone shipments dropped 10% globally in the first qtr of 2024, pressured by double-digit growth in shipments by Chinese challengers Xiaomi & Transsion, a report from Intl Data Corp (IDC).  AAPL shipped 50.1M units in the first qtr, down 9.6% from the 55.4M shipments in the same period a year earlier, according to the IDC report.  Among the top 5 smartphone brands in the report, AAPL recorded the sharpest decline year on year.  Samsung regained the top spot in the first qtr, after losing the crown to AAPL last year, with a 20.8% market share, shipping nearly the same number of units as last year at 60.1M.  Its market share was 22.5% in the first qtr of 2023.  AAPL, which surpassed Samsung as the largest smartphone maker in 2023, saw its market share drop to 17.3% from 20.7% a year earlier.  “While IDC expects these two companies to maintain their hold on the high end of the market, the resurgence of Huawei in China, as well as notable gains from Xiaomi, Transsion, OPPO/OnePlus, and vivo will likely have both OEMs looking for areas to expand and diversify,” said Ryan Reith, group VP at IDC Worldwide Mobility & Consumer Device Trackers.  AAPL stock fell 3.86.

Apple iPhone first-quarter shipments sink as Chinese challengers rise; Samsung regains top spot

US crude oil futures were lower as traders breathed a sigh of relief after Israel fended off a large-scale air assault by Iran & the US emphasized it wants to avoid a wider war in the Middle East.  The West Texas Intermediate contract for May lost $1.22 (1.4%) to $84.44 a barrel & Jun Brent futures fell $1.24 (1.4%)to $89.21 a barrel.  US crude closed at $85.66 a barrel Fri, while the global benchmark settled at $90.45.  WTI futures began the year around $71 a barrel.  “Market participants have decided that this chapter of this war story is over for now,” Helima Croft, head of commodity strategy at RBC Capital Markets, said.  But Israel's war cabinet is still weighing how it will respond to the attack: “You could still see some significant Israeli retaliation,” Croft said.  Iran launched more than 300 drones & missiles against military targets in Israel on Sat in an attack that Pres Biden described as “unprecedented.”  The US intervened to directly help Israel shoot down nearly all of the incoming munitions, Biden said.  Though significant in scale, the Iranian attack caused little actual damage in Israel.  The Nevatim Air Force Base in southern Israel sustained slight damage & a 10-year-old girl suffered injuries, according Israel Defense Forces spokesman Daniel Hagari.

Oil prices fall more than 1% after Israel fends off large-scale aerial attack by Iran

Gold traded higher midafternoon even as treasury yields rose after the US Census Bureau reported retail sales rose more than expected last month, while the metal's geopolitical premium eased after Iran's weekend attack on Israel caused little damage.  Gold for Jun was last seen up $10 to $2385 per ounce, above Fri's record close of $2374 but below Fri's record intra-day price of $2448.  US retail sales rose by 0.7% in Mar, up from a prior-month rise of 0.6% & well ahead of the estimate for a 0.3% rise.  The report is the latest to show the US economy is running hot. cutting into expectations the Federal Reserve will soon move to lower interest rates.  Iran's weekend attack on Israel was widely telegraphed, coming after Israel's Apr 1 strike on Iran's Syrian embassy that killed senior military leaders.  The weekend attack was met by an intl coalition of fighter jets & Israeli air-defense systems that allowed few of the weapons to reach targets.  The $ was higher following the retail sales report, with the ICE dollar index last seen 0.15 points to 106.19.  Treasury yields rose, bearish for gold since it offers no interest.  The 2-year note was last seen paying 4.948%, up 3.4 basis points, while the yield on the 10-year note was up 10.3 basis points to 4.636%.

Gold Trading Higher Even as Yields Rise After US Retail Sales Rose Above Expectations Last Month

Crude-oil prices settled lower after an Iranian attack on Israel caused little damage.  That helped to diminish expectations about a broader conflict involving the 2 bitter rivals, at least for now.  West Texas Intermediate crude for May shed 25¢ to settle at $85.41 a barrel & Jun Brent crude, the global benchmark, declined by 35¢ to end at $90.10 a barrel after briefly trading north of $90 a barrel.  Oil prices declined, failing to find much support from this weekend's Iranian strike against Israel, which was largely thwarted by Israel’s Defense Force (IDF).

Oil prices end lower, failing to find much support from Iran’s attack on Israel

Stocks opened with strong advance.  Then sellers took command & dragged the Dow much lower on worries about a major conflict in the Mid-East.  Nervous money bought US Treasuries & gold.

Dow Jones Industrials