IRAN: President Claims Lengthy Meeting w/Supreme Leader

• In the equity space, a strong rally in S&P E-Minis last week highlights the start of a corrective phase. Note that a correction is allowing an oversold trend condition to unwind. Initial firm resistance to watch is 6650.03 the 20-day EMA. It has been pierced, a clear break of this average would signal potential for an extension towards 6769.31, the 50-day EMA and a key area of resistance. The bear trigger has been defined at 6753.25, the Mar 31 low. 
• The trend condition in EUROSTOXX 50 futures remains bearish and - for now - recent short-term gains are considered corrective. Note that the trend has been in oversold territory recently and the latest recovery has allowed this set-up to unwind. Key pivot resistance is 5722.33, the 50-day EMA, where a clear break is required to signal a possible reversal. For bears, a resumption of weakness would open 5277.64 next, a 1.382 projection of the Mar 5 - 9 - 10 price swing.

Today’s three separate Fedspeakers add to FOMC reaction to Friday’s strong NFP report, after SF Fed’s Daly said it was “really goods news” and “very welcome” as it gives the FOMC “more time” to balance dual mandate risks. We will focus on permanent voters Williams and Jefferson. They may have spoken as recently as Mar 30/26, when they viewed policy as being well-positioned, but WTI prices are another $10/15bbl higher since then in a highly fluid backdrop. 

• 0830ET – NY Fed Williams (voter, leaning dove) on BBG TV. On Mar 30, he echoed Powell's commentary in saying policy is well-positioned, while noting risks to both elements of the dual mandate. Williams doesn't appear to be that concerned about the inflationary implications of the conflict in the Middle East beyond the immediate impact, reaching the 2% target by 2027, and expects the unemployment rate declining this year and next.
• 1235ET – Chicago Fed Goolsbee (’27) on mon pol (text tbd). He said on late on Apr 2 that spiking oil prices are “a pretty serious situation” as sustained and increased oil costs would be a tough shock. He had previously said on Mar 24 that the outlook for rates will depend on how long the Middle East war lasts and that he needs to see inflation progress for rates to come down.
• 1345ET – Goolsbee in WJR-AM radio interview
• 1750ET – VC Jefferson (voter) on economic outlook and labor market (text + Q&A). He said Mar 26 "The potential for an extended conflict in the Middle East adds considerable uncertainty to the global economic outlook. I continue, however, to see our current policy stance as appropriately positioned to allow us to assess how the economy evolves." […] "A short period of disruption is unlikely to have a noticeable effect on the economy beyond a quarter or two. A sustained energy price shock, however, could have material implications."

"SENIOR IRANIAN SOURCE TO REUTERS: TEHRAN HAS REJECTED ANY TEMPORARY CEASEFIRE WITH THE U.S."

• TEHRAN HAS SET PRECONDITIONS FOR TALKS WITH U.S. ON 'A LASTING PEACE
• PRECONDITIONS INCLUDE AN IMMEDIATE HALT TO STRIKES, GUARANTEES STRIKES WILL NOT BE REPEATED, COMPENSATION FOR DAMAGES
• UNDER A PERMANENT PEACE DEAL, TEHRAN DEMANDS FEES FOR SHIPS PASSING THROUGH HORMUZ STRAIT

USD and UST yields are lurching higher on these headlines - market noting the rejection of any temporary ceasefire. Little else in these headlines is new: the conditions outlined by this Tehran source look consistent with the ten-point response that Tehran issued to the peace proposals over the weekend, and again look incompatible with US demands for unhindered passage through the Strait.

• The mechanics within the White House negotiating team now look key: over several reports, POTUS himself is becoming the most hawkish on Iran (e.g. Axios: "Trump might be the most hawkish person [...] on Iran, [Hegseth and Rubio] sound like the doves compared to the president.")
• This contrasts with Vance, Witkoff and Kushner, who reportedly are supportive of a deal being struck "now if possible."