​EBC Markets Briefing | Oil prices rallied; Micron saw dip-buying

Oil prices rose sharply on Thursday after Trump warned of further military aggression against Iran in the next two or three weeks, dampening hopes for an imminent de-escalation in the conflict.

Iran said that the US would not regain access to the Strait of Hormuz and that from now on only "those who comply" with Iran's terms will be allowed to pass vessels through the key waterway.

The country also threatened attacks on a swath of Big Tech with operations in the Middle East. AWS data centres were hit earlier this month, which caused outrages in some digital services in the UAE.

The UK will host talks among 35 countries aimed at forming a coalition to reopen the Strait of Hormuz, after Trump told The Telegraph he was considering pulling the States out of NATO.

US crude stocks rose to their highest level since June 2023 last year, while fuel inventories fell last week as international demand picked up, driving product exports to a record high, the EIA said.

OPEC oil output plunged in March to its lowest level since June 2020, a Reuters survey found. Iraq suffered the group's biggest drop in production, while Saudi Arabia and the UAE made smaller reductions.

WTI crude dipped below the $100 threshold, but no easy exit from the ongoing war underpinned its resilience. Given bearish MACD divergence, we see a retest of $100 before falling back again.

Asset recap

As of market close on 1 April, among EBC major products, Micron Technology shares led gains. The bounce followed a brutal stretch, dragged lower by fears surrounding Google's TurboQuant memory-compression algorithm.

Nike anticipates sales will fall between 2% and 4% in Q2, worse than the 1.9% growth analysts had expected. The gross margin has declined year over year for seven straight quarters.

Japanese shares saw substantial gains, mainly driven by chip-related stocks. Large local manufacturers indicated their highest level of business optimism in over four years.

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