Markets recover as geopolitical fears recede

Dow was off 120, decliners modestly ahead of advancers 5-4 & NAZ gained 195.  The MLP index remained near 296 & the REIT index rose 2+ to the 424s.  Junk bond funds edged higher & Treasuries continued in demand, bringing lower yields.  Oil crawled higher in the 69s & gold jumped 21 to 2636 (more on both below).

Dow Jones Industrials 

Global stocks fell & investors fled to safe-haven assets, as global markets reacted to escalating tensions between the world's 2 largest nuclear powers: Russia & the US.  The pan-European Stoxx 600 stock index came off previous lows to end the trading day down 0.5% after hitting its lowest level since Aug.  In the US, many stocks reversed earlier losses.  The moves come after Russian Pres Vladimir Putin amended the country's nuclear doctrine that outlines the conditions that would prompt Moscow to deploy its nuclear arsenal.  While Moscow had signaled an interest in updating the doctrine months prior, the amendments are nevertheless being implemented within days of a US decision to allow Kyiv to use American-made long-rage missiles in Russian territory.  The Russian Defense Ministry said that Kyiv had already deployed US-made long-range ballistic missiles in an overnight strike in the Bryansk region in the west of the country.  The updated nuclear doctrine outlines the conditions that would prompt Moscow to deploy its nuclear arsenal &, critically, expands the circumstances under which it will consider nuclear retaliation.  Kremlin spokesperson Dmitry Peskov said the updated code now “states that the Russian Federation reserves the right to use nuclear weapons in the event of aggression with the use of conventional weapons against it or the Republic of Belarus, which creates a critical threat to sovereignty or territorial integrity. Aggression against the Russian Federation by any non-nuclear state with the participation or support of a nuclear state is considered a joint attack,” according to NBC News reporting.

Russia-U.S. tensions hit global markets as Putin lowers the threshold for a nuclear strike

The stock prices for H&R Block (HRB) & Intuit (INTU) fell after a report saying the Trump transition team is considering creating a free tax-filing app.  Pres Trump's “Department of Government Efficiency” has held “highly preliminary” discussions about creating the free tax-filing app.  DOGE will be led by billionaire Elon Musk & former Rep presidential candidate Vivek Ramaswamy & aims to slash gov spending.  A DOGE tax-filing app would represent a competitor for both HRB & TurboTax.  It's unclear where a new DOGE tax app would bridge with newer policies the Biden administration already implemented.  Under the Biden administration, the IRS in Mar rolled out a pilot Direct File program in 12 states, allowing qualified taxpayers to file directly through a gov portal.  The IRS also offers free filing services through its Free File program for taxpayers who make an adjusted gross income of $79K or less.  While both INTU & HRB have free filing options, neither have had stellar records when it comes to transparently offering those services.  H&R stock fell 4.96 (8%) & Intuit stock fell 34+ (5%).

H&R Block, Intuit stocks fall on news of a potential free tax-filing app by Trump transition team

Stellantis (STLA) is delaying the launch of its Ram electric pickup trucks from this year until the first ½ of 2025, as the trans-Atlantic automaker continues testing the vehicles.  CEO Carlos Tavares on declined to disclose details about what caused the delays or specific timing on the electric trucks, which include an all-electric “REV” model & an extended-range “Ramcharger” that's equipped with an electric generator & a gas engine.  “We are just facing a very significant amount of workload, and we want to be very prudent in the way we validate the products, so we take our time, and we make sure that we manage the peak,” Tavares said.  “We don’t want to rush. ... It’s better to take a few weeks more to validate properly than to rush and then to make mistakes in terms of quality. That’s what we are doing now.”  Tavares said work needs to be completed on the Dodge Charger Daytona & Jeep Wagoneer S EVs, which are expected to be released by the end of this year, before turning to the new trucks.  STLA's upcoming electric pickups are the first that will be built on the company’s new “STLA Frame platform” for its larger trucks & Jeep SUVs.   It is expected to be a “multi-energy platform” that''s capable of internal combustion engines & hybrids, as well as electric models using batteries, fuel cells and range-extended electric propulsion systems.  STLA has said the Ramcharger extended-range electric vehicle can operate as a zero-emissions EV until its battery dies & an electric onboard generator, powered by a 27-gallon, 3.6-liter V6 engine, kicks on to power the vehicle.  The stock fell 34¢.

Stellantis delays Ram electric pickups until 2025

Gold prices rose for a 2nd day as treasury yields ease & intl tensions run high after the Biden Administration permitted Ukraine to attack targets within Russia with US-supplied missiles.  Gold for Dec was last seen up $16 to $2360 per ounce.  Following months of pressure, the Biden Administration over the weekend said Ukraine can make limited missile attacks on targets within Russia, which Moscow said will mean it is now at war with NATO.  Gold's gain were supported by a softer $ & worsening US-Russia relations after the US approved Ukraine's use of long-range missiles against Russia.  The $ at last look was little changed with the ICE dollar index up 0.05 points to 106.33.  Treasury yields fell, with the 2-year note last seen down 1.5 basis points to 4.274%, while the 10-year note is down 4.3 points at 4.378%.

Gold Rises as Treasury Yields Ease and International Tensions Rise

Oil retreated after its biggest gain in more than 5 weeks as Europe's largest oilfield gradually restarted following a power outage.  Brent futures traded near $73 a barrel as Equinor ASA restored production at the Johan Sverdrup oil field in the North Sea to 2/3 of capacity after yesterday's halt.  Crude had surged 3.2% yesterday as the $ weakened, making commodities more attractive to investors.  Traders are also tracking the latest geopolitical tensions.  Ukrainian armed forces carried out their first strike in a border region within Russian territory with a ATACMS missile.  Pres Vladimir Putin pushed ahead with a pledge to update Russia's nuclear doctrine to expand the conditions for using atomic weapons, in a warning to the US.  Oil is still lower for the year as concerns around Chinese demand & plentiful global supply weigh on the outlook.  The Intl Energy Agency has forecast a potential surplus of more than 1M barrels a day next year as Chinese demand continues to falter, which could be even bigger if OPEC+ decides to revive output.  In the Middle East, Lebanon & the Hezbollah militia have agreed to a US proposal for a cease-fire with Israel, according to a top Lebanese official.  A US official cautioned that negotiations were ongoing.  Brent for Jan settlement was 0.4% lower at $73.04 a barrel & WTI for Dec, which expires tomorrow, dipped 0.5% to $68.80 a barrel.

Oil Retreats After Rally as North Sea Field Partially Restarts

Oil futures hold on to the previous day's gains with attempts at a move lower held back by increased geopolitical risk premium on reports that Ukraine fired US-supplied long-range missiles into Russia days after the US authorized their use, raising concerns of an escalation in the conflict.  Bearish views of the global supply & demand situation continue to cap rallies. With China finding it difficult to get back on a growth trajectory north of 5% & the US & Europe undergoing a cyclical slowdown, crude oil demand in 2024 & 2025 is set to grow at barely ½ of the 2M b/d pace seen over the 2022-2023 post-pandemic period.  WTI settles up 0.3% at $69.39 a barrel & Brent is flat at $70.31 a barrel.

Oil Futures Hold Gains in Volatile Session

Stocks recovered from steeper losses as fears over a nuclear escalation to the Russia-Ukraine war rattled markets.  Investors are assessing news that Pres Vladimir Putin has signed a revised nuclear doctrine that allows Russia to expand its use of atomic weapons.  Meanwhile, the tech-heavy NAZ reversed declines to gain almost 1%, boosted following a series of bullish notes from analysts.