The Off-Ramp: Trump Suspends Iran Strikes for Two Weeks — Oil Crashes 15%, Futures Soar
Today’s Brazil morning call opens on a dramatically different tone than Tuesday’s session suggested. This is part of The Rio Times’ daily Brazil Financial Morning Call, covering Latin American financial markets.
Just 90 minutes before his own 8 PM ET deadline, Trump posted on Truth Social that he agreed to “suspend the bombing and attack of Iran for a period of two weeks,” contingent on Iran reopening the Strait of Hormuz. Iran’s Supreme National Security Council accepted, and Foreign Minister Araghchi confirmed that safe passage through the Strait would be allowed under Iranian military coordination. Israel agreed to the ceasefire as well, though Netanyahu’s office clarified it does not include Lebanon. The market reaction was immediate and violent: WTI crude crashed 18% to ~$93, Brent plunged 14% to ~$94. S&P 500 futures surged 2.3%, Dow futures leapt 1,000+ points, Nasdaq futures rose 2.8%. Asia exploded higher: Nikkei +4.8%, Kospi +5.6%. Gold jumped 2.5%. The five-week war’s most consequential moment has arrived — and the relief trade is massive.
But caution is warranted. This is a two-week pause, not a peace deal. Iran claims the right to regulate Strait traffic permanently and charge tolls. Attacks continued overnight across the region even after the announcement. Netanyahu excluded Lebanon from the ceasefire. And the deal still requires Iran to actually reopen the Strait — which has not yet happened. Wednesday’s session prices in the hope; the next 14 days determine whether it’s justified.
Wednesday’s data: FOMC Meeting Minutes (14:00 ET), EIA Crude Oil Inventories (10:30 ET, cons: −1.0M), Fed’s Daly (13:00) and Waller (14:35) speak. Brazil releases IGP-DI inflation (07:00 BRT), auto production/sales (13:00 BRT), and FX flows (13:30 BRT). The FOMC minutes and Fed speakers matter enormously — if oil at $93 holds, the entire inflation calculus shifts. Delta earnings pre-market will show the airline sector’s war-era damage. War Day 40.
Three Things That Matter
| Tuesday | S&P 500 +0.08% to 6,617. Nasdaq +0.10% to 22,018. Dow −0.18% to 46,584. Session swung from −1.2% to flat on Pakistan mediation hopes. Durable goods: core +0.5% (in-line). UBS cut S&P year-end target to 7,500 from 7,700. Samsung Q1 operating profit +755% YoY (memory chip boom). WTI traded as high as $117 intraday before collapsing. USD/BRL held ~R$5.15. Gold ~$4,685. Bitcoin ~$71,758 (−0.25%). Israel struck Kharg Island military targets. IRGC intel chief killed Monday. Iran struck Israel with cluster munitions in Tel Aviv. U.S. struck Tehran overnight. Trump: “A whole civilization will die tonight” |
| Ceasefire | 6:30 PM ET: Trump agreed to two-week ceasefire via Pakistan-brokered deal. Iran’s SNSC accepted. Strait of Hormuz to reopen under Iranian military coordination — with tolls for Iran and Oman. Netanyahu agreed but excluded Lebanon/Hezbollah. WTI crashed 18% to ~$93. Brent −14% to ~$94. S&P futures +2.3%, Dow futures +1,000pts, Nasdaq futures +2.8%. Nikkei +4.8%, Kospi +5.6%. Gold +2.5%, silver +4.6%. Treasury yields declined. But: attacks continued overnight in Israel, Iran, and Gulf. Ceasefire start time unclear. Iran claims permanent Strait regulation rights. Two-week window — not permanent peace |
| Today | Ceasefire repricing day. Delta Air Lines earnings (pre-market). MBA Mortgage Applications (07:00 ET). BRL IGP-DI Inflation (07:00 BRT). EIA Crude Oil Inventories (10:30, cons: −1.0M). Thomson Reuters IPSOS PCSI for Brazil, US, Canada, Mexico, Argentina (11:00). BRL Auto Production/Sales (13:00 BRT). BRL FX Flows (13:30). FOMC Meeting Minutes (14:00 ET — critical for rate path reassessment). 10Y Note Auction (13:00). Fed’s Daly (13:00), Waller (14:35). War Day 40 |
Where We Left Off TUESDAY, APR 7 — SESSION + AFTER-HOURS
Tuesday was one of the most volatile sessions of the entire war. The S&P 500 fell as much as 1.2% intraday as Trump posted that “a whole civilization will die tonight” and the 8 PM deadline loomed with no deal in sight. The Dow dropped 211 points at the lows. Energy stocks ripped higher on $117 WTI while everything else bled. Then at approximately 4:30 PM ET, Pakistan’s Prime Minister Sharif publicly requested a two-week extension and asked Iran to open the Strait as a goodwill gesture — and the market reversed hard. The S&P 500 erased its losses to close +0.08% at 6,616.85, the Nasdaq finished +0.10% at 22,017.85, and the Dow ended −0.18% at 46,584.46.
The real fireworks came after hours. At 6:30 PM ET, Trump posted on Truth Social that he agreed to suspend attacks for two weeks, contingent on Iran’s complete and immediate reopening of the Strait. Iran’s Supreme National Security Council accepted. The market response was extraordinary: WTI crude crashed more than 18% to under $93 — its biggest one-day drop in nearly six years. Brent fell 14% to ~$94. S&P 500 futures surged 2.3%, Dow futures jumped over 1,000 points, Nasdaq futures rose 2.8%. Gold rallied 2.5% and silver surged 4.6%. Asia opened explosively: Nikkei +4.8%, Kospi +5.6%. As covered in yesterday’s Morning Call, the binary risk was clear — and the bull case materialized.
But the deal’s fine print demands attention. Iran’s Foreign Minister Araghchi stated that passage through the Strait would require coordination with Iran’s Armed Forces and would account for “technical limitations.” A regional official told the AP that the ceasefire plan includes Iran and Oman charging tolls on ships — something the world has never paid before. Netanyahu excluded Lebanon from the ceasefire despite Pakistan claiming otherwise. And attacks continued across the region overnight even after the announcement. This is a pause brokered under maximum pressure, not a peace settlement. The market is pricing hope — the next 14 days will determine whether it converts to reality.
Market Snapshot DATA AS OF TUE, APR 7 CLOSE + OVERNIGHT
| Indicator | Close / Level | Change |
|---|---|---|
| Ibovespa | 188,259 | +0.05% |
| USD/BRL | R$5.1520 | Flat |
| S&P 500 | 6,617 | +0.08% |
| S&P 500 Futures | ~6,770 | +2.3% (overnight) |
| Nasdaq | 22,018 | +0.10% |
| WTI Crude | ~$93 | −18% (overnight) |
| Brent Crude | ~$94 | −14% (overnight) |
| Gold (Spot) | ~$4,800 | +2.5% (overnight) |
| Bitcoin | ~$71,758 | +4.5% (from Mon) |
| Nikkei 225 | ~56,100 | +4.8% |
What to Watch WEDNESDAY CATALYSTS
The ceasefire repricing will dominate the open. Expect energy stocks (Petrobras, Exxon, Chevron) to sell off sharply — the oil crash from $117 to $93 in a single session is a massive headwind for the sector that had been the war’s primary beneficiary. Conversely, airlines, transports, consumer discretionary, and anything hurt by oil-driven inflation should rip higher. Delta reports pre-market and its guidance may already reflect ceasefire optimism. The rotation from defense/energy into growth/cyclicals could be the largest single-day sector shift of 2026.
The FOMC Meeting Minutes at 14:00 ET are the key data event. These are from the March meeting — when the committee was grappling with the initial oil shock — but any signals about how the Fed views transitory vs. structural inflation from the conflict will be parsed intensely. If oil settles in the $90-95 range (down from $110-117), the entire rate-cut calculus resets. Fed’s Daly (13:00) and Waller (14:35) will be the first Fed speakers to react in real-time to the ceasefire — their tone will set expectations for the April 28-29 FOMC meeting.
EIA crude oil inventories at 10:30 (cons: −1.0M draw) will show the extent of the supply crunch that built during the Hormuz closure. A larger-than-expected draw reinforces the fragility argument — even with the Strait reopening, it will take weeks for physical oil flows to normalize. Brazil’s IGP-DI inflation at 07:00 BRT and auto data at 13:00 BRT round out the domestic calendar. The 10-Year Note Auction at 13:00 will test whether the bond market is repricing the inflation outlook lower.
Ibovespa Setup TECHNICAL LEVELS
The Ibovespa closed at 188,258.91 (+0.05%) on Tuesday, essentially flat as the market waited for the deadline outcome. From the chart: O:188,162, H:188,259, L:185,885, C:188,259. RSI at 59.79 (MA: 52.79) — firmly bullish with room to extend. The MACD histogram jumped to 1,478 (MACD: 768.59, signal: 709.69) — a strongly expanding bullish crossover. The ceasefire should provide the catalyst for a push toward the February ATH at 191,247.
Resistance: 188,259 (Tuesday close) → 190,054 (upper Bollinger) → 191,247 (Feb 25 ATH) → 192,624 (Feb 25 intraday ATH).
Support: 185,791 (mid-Bollinger) → 184,247 (SMA cluster) → 183,844 / 182,867 (moving average convergence) → 182,575 (20-day) → 179,451 (lower range) → 175,679 (lower Bollinger) → 156,372 (200-day).
Copom Watch SELIC AT 14.75% · NEXT MEETING: APR 28-29
The ceasefire is the most significant dovish development for the BCB since the war began. If WTI settles in the $90-95 range — down 20%+ from last week’s highs — the oil-driven inflation channel that had been the primary obstacle to cuts narrows dramatically. Combined with the USD/BRL at R$5.15, PPI at −4.5% annual, and the IPCA-15 at 3.90%, the domestic inflation picture becomes far more manageable.
However, two weeks is not permanent peace. The BCB will want to see whether the ceasefire holds and whether Hormuz actually reopens to normal traffic before shifting its stance. Today’s IGP-DI inflation data will add to the price picture. The April 28-29 meeting falls right at the ceasefire’s expiration — the committee will be making its decision precisely as the world learns whether the pause converts to lasting peace or a return to conflict. The probability of a May cut has shifted from “dead” to “conditional on ceasefire extension” — a meaningful change in the policy outlook.
Economic Calendar WEDNESDAY, APR 8
| Time | Event | Impact |
|---|---|---|
| Pre-Market | Delta Air Lines Q1 earnings (pre-market — airline sector war-era damage read). India rate hold at 5.25%. Japan Economy Watchers fell to 42.2 (miss vs 48.0 cons). German Factory Orders +0.9% (miss vs +3.0%). UK Halifax House Price −0.5%. European construction PMIs. EUR PPI (05:00, cons: −0.6% MoM) | MEDIUM |
| 07:00–08:00 BRT | BRL IGP-DI Inflation (07:00, prev: −0.84%). Chile CPI (07:00, cons: +0.9% MoM). MBA Mortgage Applications (07:00 ET, prev: −10.4%). Mexico Consumer Confidence (08:00, prev: 44.4). Domestic inflation and demand reads | MEDIUM |
| 10:30 ET | EIA Crude Oil Inventories (cons: −1.0M, prev: +5.451M). Cushing inventories, refinery runs, gasoline/distillate stocks. Critical supply-crunch read — how depleted are inventories after 5 weeks of Hormuz closure? | HIGH |
| 13:00–14:35 ET | 10Y Note Auction (13:00, prev: 4.217%). Fed’s Daly (13:00). BRL Auto Production/Sales (13:00 BRT). BRL FX Flows (13:30). FOMC Meeting Minutes (14:00 — rate path reassessment in light of ceasefire). Fed’s Waller (14:35). Minutes + Daly + Waller = first Fed reaction to ceasefire oil crash | HIGH |
Latin America Markets TUESDAY CLOSE / CHART DATA
| Index | Close | Change | RSI (14) | Signal |
|---|---|---|---|---|
| Ibovespa | 188,259 | +0.05% | 59.79 | Bullish |
| IPC (Mexico) | 68,529 | −0.66% | 45.11 | Neutral |
| COLCAP (Colombia) | 2,281 | −0.85% | 47.74 | Neutral |
| IPSA (Chile) | 10,518 | −1.65% | 46.23 | Neutral |
| MERVAL (Argentina) | 2,972,629 | −1.12% | 53.76 | Neutral |
LatAm closed Tuesday before the ceasefire announcement — today’s opens will be explosive. Chile’s IPSA took the biggest hit, falling 1.65% to 10,518 with RSI dropping to 46.23 as the copper-heavy index suffered from pre-deadline risk-off. Argentina’s MERVAL fell back below 3 million, dropping 1.12% to 2,972,629. Colombia’s COLCAP slipped 0.85% to 2,281. Mexico’s IPC fell 0.66% to 68,529 with RSI at 45.11. The Ibovespa was the sole regional holdout, closing marginally positive at 188,259 — a testament to its structural advantages. All five indices outside Brazil were in neutral or bearish RSI territory heading into the ceasefire. Wednesday’s sessions should see broad-based relief rallies across the region, with the Ibovespa positioned to test its February all-time highs. As noted in the latest LATAM Pulse, the region’s oil-import-dependent economies stand to benefit most from the crude crash.
Commodities & FX KEY MOVES
Oil experienced its largest single-session crash in nearly six years. WTI plunged from an intraday high of $117 to under $93 after hours — an 18%+ swing. Brent fell 14% to ~$94. Even after the drop, crude remains up more than 40% since the war began on February 28 (WTI settled at $67 pre-war). The ceasefire’s toll mechanism — Iran and Oman charging fees for Strait passage — creates a new permanent cost layer for global shipping. GasBuddy’s Patrick De Haan warned that the two-week window likely means “another two weeks of status quo and barely anything getting through the Strait.” Physical reopening takes time: insurance premiums must recalibrate, tankers must reposition, and the Iranian military must actually allow passage. The EIA inventories today will show how depleted U.S. stocks are after five weeks of disruption.
Gold surged 2.5% overnight to ~$4,800, while silver jumped 4.6%. The counterintuitive move — gold rising alongside risk-on assets — reflects the broader repricing: lower oil = lower inflation expectations = lower real yields = gold-positive. The precious metals may also be pricing in a weaker dollar as the de-escalation reduces safe-haven demand for USD.
USD/BRL held steady at R$5.1520 through Tuesday’s session, as the chart shows flat OHLC at 5.1520. RSI at 47.30 (MA: 43.06). The real should benefit from the ceasefire on two fronts: reduced global risk premium and the potential for the BCB to shift toward cuts if oil stays below $100. However, lower oil also reduces Brazil’s commodity export revenue — a partial offset. The net effect should be modestly BRL-positive as risk appetite returns to EM.
Bitcoin surged to $71,758 on Tuesday (chart: O:71,911, H:72,104, L:71,234, C:71,758), with RSI jumping to 58.73 (MA: 46.87) — the strongest momentum reading in weeks. The $72,000 level remains the key breakout trigger. The ceasefire risk-on should provide the catalyst for a push higher. If BTC clears $72K decisively, the next target is $78K-80K based on the weekly chart structure.
Risk Map BULL vs BEAR
| Bull Case | Bear Case |
|---|---|
| The ceasefire removes the tail risk that paralyzed markets for six weeks — Even a temporary pause allows supply chains to begin normalizing. Oil below $95 reduces the stagflation threat. Airlines, consumers, manufacturers all benefit immediately. If the Strait actually reopens, the $20/bbl war premium unwinds further toward $80-85. The S&P 500’s death cross and 200-day resistance become testable obstacles rather than ceilings.
The Fed path resets — If oil stays below $100, the inflation surge that forced “higher for longer” expectations becomes transitory by definition. The March FOMC minutes will show a committee worried about oil — but the data has now changed. Rate cut expectations can rebuild. For Brazil, the BCB’s April 28 meeting becomes a live cut possibility again. The rotation trade is massive — Five weeks of energy/defense outperformance and tech/growth underperformance can partially unwind in days. Goldman called tech the best buying opportunity in months. Samsung’s +755% profit beat shows AI demand is undiminished by the war. The breadth rally from defense-to-growth could carry the S&P 500 toward 6,800. |
Two weeks is not peace — it’s a pause before the next crisis — Trump has set and broken deadlines repeatedly. Iran claims the right to permanently regulate and toll the Strait. Netanyahu excluded Lebanon. Attacks continued overnight even after the announcement. The ceasefire expires on April 21 — right before the BCB’s meeting. If talks collapse, the repricing to the upside in oil (and downside in equities) will be faster and more violent than the initial shock.
Physical oil flows won’t normalize in two weeks — Insurance premiums are still triple normal levels. Tankers need to reposition. Iran’s military “coordination” requirement adds friction. The inventory drawdowns from five weeks of closure will take months to rebuild. GasBuddy warns gas prices won’t drop quickly. The inflation damage is already baked into Q2 data. The April 2 tariff shock hasn’t been priced yet — The labor market’s four-month average of +47K/month was already fragile before the war. Now tariffs are live. The initial jobless claims data in coming weeks will be the first signal. If claims rise sharply while oil-driven inflation persists, the stagflation narrative survives the ceasefire. Energy stocks selling off while the economy weakens is the worst of both worlds for Brazil’s exporters. |
Positioning BOTTOM LINE
The ceasefire changes everything — and nothing. The immediate market reaction is appropriate: oil below $95 removes the acute stagflation threat, equity futures surging 2%+ reflects the unwinding of six weeks of geopolitical risk premium, and Asia’s explosive rally (Nikkei +4.8%, Kospi +5.6%) confirms the global breadth of the relief. Wednesday’s open should be the most positive session for global equities since late February.
But the fine print matters. Iran is not simply reopening the Strait — it is claiming permanent regulatory authority over a waterway the world previously treated as international. The toll mechanism with Oman creates a new structural cost. Netanyahu’s exclusion of Lebanon means the broader regional conflict remains hot. And the two-week window expires on April 21, just one week before the BCB meets and the same week as the next FOMC. This ceasefire is a bridge, not a destination.
For the Ibovespa, today should be a strong session. The index enters with RSI at 60, bullish MACD crossover, and the structural carry-trade bid that has made it the most resilient EM index throughout the war. A push toward the February ATH at 191,247 is the natural target. However, the sector composition will shift: Petrobras and energy names face headwinds from the oil crash, while banks, domestic consumption, and rate-sensitive sectors should rally as the cut path reopens. Embraer and defense exporters may give back some war-era gains.
The FOMC Minutes at 14:00 and Fed speakers (Daly, Waller) are the day’s second act. If the Fed signals that the oil-driven inflation was transitory — and the data now supports that view — the rate-cut trade rebuilds aggressively. The 10-Year auction at 13:00 will show whether the bond market is already repricing lower yields. For the BCB, the April 28 meeting just became the most interesting since the war began. Watch oil closely: if WTI stabilizes above $90 rather than continuing lower toward $80, the market may be telling you the war premium isn’t fully unwound — and two weeks is not enough.
RT Staff Reporters · This newsletter is for informational purposes only and does not constitute investment advice. Always consult a licensed financial advisor before making investment decisions. Past performance does not guarantee future results.
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