TLDR

MARKET RECAP → The Dow (DIA) took a 400-point dive on Wednesday, reacting sharply to the hotter-than-expected March inflation report, dimming hopes for the near-term interest rate cuts many investors were banking on.

INFLATION INSIGHTS → 🚀 March's CPI jolt, with a 3.5% year-over-year leap driven by stubborn shelter and energy costs, served a cold dish to rate cut hopefuls, suggesting the Federal Reserve might keep the interest rate scissors in the drawer a bit longer than anticipated.

COPPER SOARS → 🚀 Amidst soaring demand and tight supplies, copper hit its 2024 peak with Wall Street banks betting big on its continued ascent; skeptics, however, warn that what goes up in the commodities market must eventually find equilibrium.

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MARKETS

Today’s S&P 500 Heatmap

Notable Earnings This Week

TODAY’S TOP NEWS

INFLATION INSIGHTS

📈 Prices Climbed Surprisingly: In March, the CPI, measuring a wide array of goods and services, increased by 0.4% over the month, pushing the annual inflation rate to 3.5%, a tad higher than February's rate and surpassing economists' forecasts. This uptick, spearheaded by shelter and energy costs, might just put the Federal Reserve's rate-cut dreams on a longer snooze.

🏠 Housing and Energy Take the Lead: Energy costs lit up by 1.1%, while shelter costs, a heavyweight in the CPI with a one-third share, also climbed by 0.4%, marking a 5.7% rise from the previous year. This upward trend in essential living costs could rewrite the Federal Reserve's inflation cooling script, previously reliant on a slowdown in shelter expenses.

🍳 Mixed Bag in the Pantry: The food sector saw minimal overall price increases, but don't let that fool you. Egg prices scrambled up by 4.6%, while meat, fish, poultry, and eggs collectively rose by 0.9%. On the flip side, butter and cereal prices took a slight dip. This mixed culinary inflation tale adds another layer of complexity to the Federal Reserve's seasoning on interest rate decisions.

TODAY’S TOP NEWS

COPPER SOARS

🔝 Copper Prices Skyrocket: Copper prices have surged, with May delivery hitting $4.323 per pound in New York, marking the highest level since June 2022. This rally is fueled by supply concerns and a bullish outlook on demand, particularly for energy transition metals, underscoring copper's pivotal role in the green economy and its status as a barometer for economic health.

📈 Banks Bullish on Copper: Wall Street giants, like Citi and Bank of America, have upped their price forecasts, with Citi projecting an average price of $10,000 per metric ton by year-end and potentially reaching $15,000 in a bull scenario. This optimism is rooted in copper's essential role in the energy transition and a predicted shift into a second secular bull market two decades after the first.

🔄 A Divided View on Sustainability: Despite the bullish trend, not all analysts believe the copper price rally will sustain throughout the year. Some, like BMO Capital Markets, argue that commodity markets will eventually balance themselves through demand adjustments, especially if copper prices significantly outpace those of alternatives like aluminum.

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