Iran Deal Hopes · Brent −8% to $101 · WTI −7% to $95 · S&P 7,365 ATH · Nasdaq 25,839 ATH · Ibovespa Reclaims Kijun · MERVAL +4.4% · Trump: Bombing Resumes If No Deal · War Day 68
Brent Crashed 8% to $101 on Iran Deal Hopes, the S&P Closed Above 7,300 for the First Time, and the Ibovespa Reclaimed the Kijun
Axios reported Wednesday that the White House believes it is nearing a 14-point memorandum of understanding with Iran to end the war and establish a framework for nuclear talks, according to two US officials and two other sources briefed on the matter. Brent crude collapsed 7.8% to $101.27 per barrel — hitting an intraday low of $96.73, per Trading Economics — while WTI plunged 7% to $95.08, with an intraday low of $88 per barrel, according to CNBC. The S&P 500 surged 1.46% to 7,365.12, its first close above 7,300 and a new all-time record, per CNBC. The Nasdaq jumped 2.02% to 25,838.94 (record). The Ibovespa rose 0.50% to 187,690.86, reclaiming the Kijun at 187,197 on a session where Open = Low for the second time this cycle, according to B3 data. Below: the deal’s terms, the oil rout’s market implications, the LatAm rally, and what Thursday’s 48-hour deadline means.
President Trump paused “Project Freedom” — the three-day-old naval escort operation through Hormuz — citing “great progress” in negotiations, per NBC News. Vice President JD Vance, special envoy Steve Witkoff, and Jared Kushner are in Islamabad holding direct talks through Pakistani mediators, according to Axios. Iran’s foreign ministry confirmed to CNBC it was “evaluating” the US proposal. But Trump told the New York Post it was “too soon” to sign and posted on social media: “If they don’t agree, the bombing starts, and it will be, sadly, at a much higher level and intensity than before.” The US expects Iran’s response on key points within 48 hours, per Axios. Zero ships transited Hormuz on Wednesday, and 23,000 seafarers from 87 countries remain stranded, according to S&P Global Market Intelligence. Thursday: Brazil Industrial Production (13:00 BRT, cons: −0.2% MoM / +3.5% YoY). Mexico CPI (13:00). US Initial Claims (13:30 ET, cons: 205K). US Unit Labor Costs Q1 (cons: 2.6%). Nonfarm Productivity Q1 (cons: 0.7%). Banxico rate decision (20:00, cons: cut to 6.50%). Iran 48-hour response window. Nikkei +5% overnight. War Day 68.
Three Things That Matter
| Yesterday | Axios: US & Iran nearing 14-point MOU to end war — 2 US officials + 2 sources (Axios). Vance, Witkoff, Kushner in Islamabad. Iran “evaluating” proposal (CNBC). Trump paused Project Freedom citing “great progress” (NBC News). Trump: “bombing starts at much higher level” if no deal. Brent −7.8% to $101.27 (intraday low $96.73, Trading Economics). WTI −7% to $95.08 (low $88, CNBC). S&P 500 +1.46% to 7,365 — FIRST CLOSE ABOVE 7,300, ATH (CNBC). Nasdaq +2.02% to 25,839 ATH. Dow +612 to 49,911. Energy −4%. Corning +17% (Nvidia partnership). ARM +13.6%. Ibovespa +0.50% to 187,691 — KIJUN RECLAIMED (B3). Open = Low at 186,762. USD/BRL R$4.9527. IPC Mexico +1.84% to 69,855. MERVAL +4.42% to 2,881,352. IPSA +2.30%. COLCAP +0.73%. ADP: 183K (beat 118K cons). EIA crude −6.2M. DoorDash +10% AH. Fortinet +16% AH. ARM +8% AH. Zero ships crossed Hormuz (S&P Global) |
| Overnight | Nikkei 225 +5%, hit 62,000 for first time — SoftBank +13% (CNBC). Kospi rallied. Australia +0.9%. Trump warned Iran would be “bombed at much higher level” if it fails to agree (CNBC). S&P 500 futures +0.87% (Yahoo Finance). Nasdaq futures +1.50%. Gold $4,712 (+3.14%) on deal uncertainty. Brent stabilized near $101 (Trading Economics). German Factory Orders +5.0% MoM (beat +1.0% cons). Australia trade deficit $1.84B (missed $4.38B surplus cons — imports surged 14.1%). Japan BoJ minutes released. French trade deficit widened to −€6.9B. DoorDash +10% AH on Q2 guidance beat (CNBC). Fortinet +16% AH on billings guidance raise |
| Today | IRAN 48-HOUR RESPONSE WINDOW — deal or escalation (Axios). Brazil Industrial Production Mar (13:00 BRT, cons: −0.2% MoM / +3.5% YoY). Mexico CPI Apr (13:00, cons: 4.50% YoY / 0.25% MoM). Mexico Core CPI (cons: 4.27%). US Initial Claims (13:30 ET, cons: 205K vs prev 189K). US Nonfarm Productivity Q1 (cons: 0.7%). US Unit Labor Costs Q1 (cons: 2.6%). Challenger Job Cuts. UK Construction PMI (09:30, cons: 45.8). Eurozone Retail Sales (10:00, cons: −0.3%). ECB speakers: De Guindos, Lane, Elderson, Schnabel. Banxico Rate Decision (20:00 ET, cons: cut 25bp to 6.50%). FOMC Kashkari (19:00). FOMC Williams (20:30). Brazil Trade Balance. Chile Trade Balance. Argentina Industrial Production. Consumer Inflation Expectations (16:00). Warsh takes Fed chair May 15 (8 days). War Day 68 |
The 14-Point MOU That Crashed Oil and Rallied Global Equities
Axios reported Wednesday, citing two US officials and two other sources, that the White House believes it is “getting close” to a one-page, 14-point memorandum of understanding with Iran. The MOU would formally end Operation Epic Fury and establish a framework for subsequent nuclear negotiations, according to the report. Vice President JD Vance, special envoy Steve Witkoff, and Trump’s son-in-law Jared Kushner are conducting direct talks in Islamabad through Pakistani intermediaries. Iran’s foreign ministry spokesperson told CNBC that Tehran was “evaluating” the US proposal. The US expects Iran’s response on “several key points” within 48 hours, per Axios — placing the deadline around Friday, May 8.
The market’s reaction was immediate and violent. Brent crude crashed 7.8% to close at $101.27, hitting an intraday low of $96.73 — the first time below $100 since late March, according to Trading Economics. WTI fell 7% to $95.08, with an intraday low of $88, per CNBC. The S&P Energy sector dropped 4% in a single session, per TheStreet. But Trump simultaneously injected uncertainty: he told the New York Post it was “too soon” to prepare to sign, and posted on social media that “if they don’t agree, the bombing starts, and it will be, sadly, at a much higher level and intensity than before,” according to NBC News. The dual signal — deal hope plus escalation threat — is the defining feature of the current negotiation phase. ING’s Warren Patterson noted that “roughly 13 mb/d of disrupted supply is being largely offset by inventory, which is clearly declining rapidly.” Zero ships crossed Hormuz on Wednesday, and 23,000 seafarers from 87 countries remain stranded, according to S&P Global Market Intelligence.
The Ibovespa Reclaimed the Kijun at 187,197 as Oil Collapsed
Wednesday: O:186,762.11, H:188,674.36, L:186,762.11, C:187,690.86 (+0.50%, +937.04), per B3 data. Open = Low for the second time this cycle — the bullish pattern that defines buyer-controlled sessions. The Ibovespa decisively reclaimed the Kijun at 187,197, closing 494 points above it. This is the formal technical confirmation that yesterday’s Morning Call flagged as the recovery signal. MACD: main line at 1,000.95, signal at −169.27, histogram at −1,170.22 per TradingView — the histogram has compressed from −1,450 (Monday) to −1,170, confirming the bearish momentum is decelerating. RSI at 52.78, signal at 46.89 — both lines above their respective lows, with the 5.9-point gap narrowing toward a bullish crossover.
Resistance: 187,691 (Wednesday close) → 188,048 → 188,674 (Wednesday high) → 188,925 → 190,794 → 198,658 (ATH).
Support: 187,197 (Kijun — NOW SUPPORT AGAIN) → 187,206 → 186,762 (Wednesday low/open) → 185,600 → 184,504 (Apr 29 panic low) → 161,560 (200-day SMA).
Market Snapshot AS OF WED, MAY 6 CLOSE
| Indicator | Close / Level | Change |
|---|---|---|
| Ibovespa | 187,690.86 | +0.50% KIJUN RECLAIMED (B3) |
| USD/BRL | R$4.9527 | +0.11% (bounced from R$4.91) |
| S&P 500 | 7,365.12 | +1.46% ATH · FIRST >7,300 (CNBC) |
| Nasdaq | 25,838.94 | +2.02% ATH (ARM +13.6%) |
| Dow Jones | 49,910.59 | +1.24% (+612 pts · near 50K) |
| Brent Crude | $101.27 | −7.8% (low $96.73 · CNBC) |
| WTI Crude | $95.08 | −7% (low $88 · CNBC) |
| Gold | $4,712* | +3.14% Thu pre-mkt (Yahoo) |
| Bitcoin | $81,318 | −0.16% (flat · TradingView) |
| ADP Employment | 183K | BEAT (cons 118K) |
As of Wednesday, May 6, 2026 close. * = Thursday pre-market. Sources: B3, CNBC, Trading Economics, Yahoo Finance, TradingView, Axios, NBC News, S&P Global.
Latin America Staged Its Broadest Rally of 2026
| Index | Close | Change | RSI (14) | Signal |
|---|---|---|---|---|
| Ibovespa (Brazil) | 187,690.86 | +0.50% | 52.78 | Kijun Reclaimed |
| IPC (Mexico) | 69,855.23 | +1.84% | 56.96 | Bullish |
| MERVAL (Argentina) | 2,881,352 | +4.42% | 52.11 | Strong Rally |
| IPSA (Chile) | 10,937.19 | +2.30% | 53.99 | Recovery |
| COLCAP (Colombia) | 2,187.45 | +0.73% | 43.16 | Recovering |
Wednesday was the broadest single-day LatAm rally of 2026. All five tracked indices rose, with the average gain at 1.96%, per TradingView data. Argentina’s MERVAL led with a stunning 4.42% surge to 2,881,352 — the sharpest single-day gain since the November 2025 Milei reform rally — as lower oil prices reduce Argentina’s energy import bill, the country’s largest fiscal drag. Mexico’s IPC surged 1.84% to 69,855, its best session since early April, ahead of Thursday’s CPI release and Banxico rate decision (consensus: cut 25bp to 6.50%). Chile’s IPSA jumped 2.30%, reclaiming the 10,900 level. The Ibovespa’s +0.50% was the most modest gain in the region — but the Kijun reclaim is the more significant technical event. As covered in the latest LATAM Pulse, a resolution of the Iran conflict would structurally reset every LatAm inflation forecast and central bank rate path.
Commodities, FX, and Crypto
Oil: Brent’s 7.8% crash to $101.27 — with an intraday low of $96.73, according to Trading Economics — was the largest single-day decline since the war began on February 28. WTI fell 7% to $95.08 (low $88), per CNBC. The S&P Energy sector lost 4%, per TheStreet. Brent stabilized near $101 in Thursday pre-market. ING noted “roughly 13 mb/d of disrupted supply” is being offset by rapidly declining inventories. For Brazil, Brent at $101 is $21 above the BCB’s ~$80 reference scenario — down from $34 at the $114 peak on Monday. If the deal materializes and Brent retests $90, the entire Copom inflation math resets: the June 17-18 cut becomes not just viable but likely, and terminal Selic estimates compress 75-100bp.
USD/BRL: R$4.9527 (+0.11%) — a marginal weakening from Tuesday’s R$4.91 multi-year low, per TradingView (Pepperstone feed). O:4.9382, H:4.9673, L:4.9377. RSI at 32.42 (signal: 31.15) — both deeply oversold. The BRL’s slight bounce from R$4.91 is consistent with profit-taking on the carry trade, not structural weakening. The real has now traded below R$5.00 for five consecutive weeks. If the Iran deal materializes, R$4.85-4.90 becomes the new target range as rate-cut expectations compress and oil pass-through eases.
Bitcoin: $81,318 (−0.16%) — flat on a day equities surged, per Bitstamp/TradingView. O:81,436, H:81,484, L:80,728. RSI at 68.30 (signal: 62.17). BTC decoupled from the equity rally, suggesting the $80-82K range represents local resistance. Gold: surged to $4,712 (+3.14%) in Thursday pre-market, per Yahoo Finance — a paradoxical move given the deal hopes. The gold bid reflects uncertainty: Trump’s “bombing at much higher level” threat means the deal is not done, and gold prices the tail risk of escalation rather than the base case of resolution.
Thursday’s Catalysts: The 48-Hour Window, Brazil IP, and Banxico
The Iran 48-hour response window is the dominant global variable. Axios reported the US expects Iran’s answer on key points by Friday, May 8. If Iran accepts the MOU framework, oil retests $90 and the war-premium unwind accelerates. If Iran rejects, Trump has already stated the bombing resumes “at a much higher level.” The binary outcome defines Thursday’s risk profile. S&P 500 futures are up 0.87%, Nasdaq futures +1.50% in pre-market, per Yahoo Finance — suggesting the market is pricing deal completion at >50% probability.
Brazil Industrial Production at 13:00 BRT (consensus: −0.2% MoM, +3.5% YoY) will show whether the Copom ata’s deceleration thesis is confirmed by hard data, per Trading Economics consensus. A miss would reinforce the dovish ata read. US Initial Claims at 13:30 ET (consensus: 205K, prev: 189K) and Unit Labor Costs Q1 (consensus: 2.6%) are the US data events. Banxico’s rate decision at 20:00 ET (consensus: cut 25bp to 6.50%) is the LatAm monetary policy event — if delivered with dovish guidance in the context of falling oil, it sets a precedent for other LatAm central banks including the Copom. Mexico CPI at 13:00 (consensus: 4.50% YoY) provides the domestic inflation context. The Nikkei surged 5% overnight to 62,000, per CNBC — the first time above that level — led by SoftBank (+13%). The global risk-on bid is the strongest since mid-April.
Economic Calendar THURSDAY, MAY 7
| Time | Event | Impact |
|---|---|---|
| Pre-Market | German Factory Orders +5.0% MoM (beat +1.0% cons). Nikkei +5%, hit 62,000 first time (CNBC). Australia trade deficit −$1.84B (massive miss). French trade deficit −€6.9B. ECB de Guindos speaks. European Construction PMIs. UK Construction PMI (09:30, cons: 45.8). Eurozone Retail Sales (10:00, cons: −0.3%) | MEDIUM |
| 13:00 BRT/ET | Brazil Industrial Production Mar (cons: −0.2% MoM / +3.5% YoY). Mexico CPI Apr (cons: 4.50% YoY / 0.25% MoM). Mexico Core CPI (cons: 4.27%). Mexico PPI | HIGH |
| 13:30 ET | US Initial Claims (cons: 205K vs prev 189K). Continuing Claims (cons: 1,800K). Nonfarm Productivity Q1 (cons: 0.7%). Unit Labor Costs Q1 (cons: 2.6%). Challenger Job Cuts. Chile Trade Balance/Copper Exports | HIGH |
| 15:00–16:30 ET | Construction Spending Mar (15:00, cons: 0.3%). Natural Gas Storage (15:30). Consumer Inflation Expectations Apr (16:00, prev: 3.4%). 4-Week + 8-Week Bill Auctions (16:30). Atlanta Fed GDPNow Q2 (16:30, cons: 3.7%) | MEDIUM |
| 18:00–20:30 ET | ECB Schnabel speaks (18:00). FOMC Kashkari speaks (19:00). Brazil Trade Balance (19:00, cons: 10.9B). Banxico Rate Decision (20:00, cons: cut 25bp to 6.50%). Argentina Industrial Production. Consumer Credit (20:00, cons: 12.5B). FOMC Williams speaks (20:30) | HIGH |
Risk Map BULL vs BEAR
| Bull Case | Bear Case |
|---|---|
| The 14-point MOU is the closest to a deal since the war began. Vance, Witkoff, and Kushner in Islamabad. Iran “evaluating.” Project Freedom paused. If Iran accepts within 48 hours, Brent retests $90, Hormuz reopens gradually, and the entire inflation/rate picture resets. The Ibovespa’s path to 195K+ is the base case in a deal scenario.
The Kijun reclaim + S&P above 7,300 + Nikkei at 62,000 = the strongest global risk-on since mid-April. The correction from 198,658 to 184,504 is formally over with the Kijun back as support. The MACD histogram is compressing. Futures point to another strong Thursday. The MERVAL’s +4.42% and IPC’s +1.84% show the deal-hope bid is broadest in EM. Brent at $101 changes the Copom math. At $101, the oil premium above the BCB’s $80 reference is $21 — down from $46 at the $126 peak. If Brent stabilizes in the $90-100 range, Focus IPCA decelerates, and the June 25bp cut becomes not just viable but likely. Terminal Selic estimates compress 75-100bp. The carry trade deepens further. |
Trump’s “bombing at much higher level” threat means the deal is not done. Previous efforts have fallen short (Axios’s own caveat). Zero ships crossed Hormuz on Wednesday (S&P Global). 23,000 seafarers stranded. Iran’s response is not yet delivered. If Tehran rejects or stalls, oil reverses to $115+ in hours and the equity rally unwinds. The market is priced for deal, not for failure.
The oil rout’s intraday volatility was extreme — Brent hit $96.73, then recovered to $101. WTI touched $88 intraday. These are 15%+ intraday swings that reflect positioning liquidation, not fundamental repricing. If the deal collapses, the snapback will be equally violent. The risk/reward is asymmetric to the downside at these levels. Even if the deal materializes, the inflation damage is already done. Focus IPCA at 5.0%, expectations de-anchored through 2028, ISM Prices at 84.6, Core PCE at 4.3%. A Brent return to $90 doesn’t undo the second-round effects: fuel price hikes, transport cost pass-through, and wage expectations already elevated. The Copom’s cutting cycle may still be shorter than pre-war. |
Positioning BOTTOM LINE
Wednesday was the most consequential session since the war began. The Axios report of a 14-point MOU crashed Brent 7.8% to $101 (intraday low $96.73), pushed the S&P 500 above 7,300 for the first time, sent the Nikkei to 62,000, and triggered the broadest LatAm rally of 2026. The Ibovespa reclaimed the Kijun at 187,197, the MERVAL surged 4.42%, and Mexico’s IPC gained 1.84%. The correction from the 198,658 ATH to the 184,504 panic low is technically over. The market is now priced for a deal — and the 48-hour response window that Axios reported means Friday, May 8, is the binary event.
The risk is that the deal doesn’t happen. Trump himself called it a “big assumption” and threatened “bombing at much higher level.” Previous negotiation attempts have failed. Zero ships crossed Hormuz on Wednesday. The market’s reaction to a rejection would be equally violent in reverse — Brent back to $115+, equities giving back 2-3% in hours. Gold’s +3.14% surge in Thursday pre-market confirms the tail risk is being hedged. The setup is high-conviction directional: if the deal materializes, the Ibovespa targets 192K-195K by next week and the entire EM rate-cycle reprices dovish. If it collapses, 184K retested.
Bias: Cautiously bullish, positioned for deal but hedging for failure. The Ibovespa above the Kijun at 187,691 with S&P futures +0.87% and Nikkei +5% overnight points to a gap-up toward 189K-190K on Thursday. Brazil Industrial Production (13:00 BRT) and Banxico (20:00 ET) are the domestic catalysts. The 48-hour Iran window is the world’s catalyst. Watch Brent — if it breaks below $95 on Thursday, the deal is being priced as done. If it bounces back above $105, doubt is returning. The war may be ending. The Ibovespa’s recovery phase has begun. But this is the Strait of Hormuz — nothing is certain until ships are moving.
Frequently Asked Questions
What is the 14-point memorandum of understanding between the US and Iran?
Axios reported on May 6, citing two US officials and two other sources, that the White House is nearing a one-page, 14-point MOU with Iran. The agreement would formally end Operation Epic Fury and establish a framework for subsequent nuclear negotiations. The deal is being mediated through Pakistan, with VP Vance, Steve Witkoff, and Jared Kushner conducting talks in Islamabad. Iran’s foreign ministry told CNBC it was “evaluating” the proposal. The US expects Iran’s response within 48 hours.
Why did oil prices crash on May 6?
Brent crude fell 7.8% to $101.27 (intraday low $96.73) and WTI dropped 7% to $95.08 (low $88), according to CNBC and Trading Economics. The crash was triggered by the Axios report of a near-deal between the US and Iran, combined with Trump’s decision to pause Project Freedom, the naval operation to escort ships through Hormuz. The S&P Energy sector lost 4% in a single session. This was the largest single-day oil decline since the war began on February 28, 2026.
Has the Ibovespa’s correction ended?
The Ibovespa reclaimed the Kijun at 187,197 on Wednesday, closing at 187,690.86 (+0.50%), per B3 data. The index has recovered 3,187 points (1.7%) from the 184,504 panic low on April 29. The Kijun reclaim is the formal technical signal that the correction phase has ended and the recovery phase has begun, according to Ichimoku analysis. The next upside targets are 189,668 and 190,794. The correction from the 198,658 ATH to the 184,504 low was 14,154 points or 7.1%.
When will Iran respond to the US proposal?
According to Axios, the US expects Iran to respond on “several key points” within 48 hours of Wednesday, May 6 — placing the effective deadline around Friday, May 8. Iran’s foreign ministry confirmed to CNBC that Tehran was “evaluating” the proposal. However, President Trump cautioned it was a “big assumption” that Iran would accept and threatened to resume military strikes “at a much higher level” if a deal is not reached. The 48-hour window is the dominant global market variable through Friday.
What does Brent at $101 mean for the Copom’s June decision?
Brent at $101 reduces the premium above the BCB’s reference scenario (~$80) from $34 at last week’s peak to $21. If Brent stabilizes in the $90-100 range through the June 17-18 Copom meeting, the inflation pass-through pressure eases and a third consecutive 25bp cut to 14.25% becomes the base case. Genial Investimentos maintains its forecast of 25bp cuts at every meeting, targeting 13.25% terminal Selic. However, Focus IPCA at 5.0% and expectations de-anchored through 2028 still constrain the BCB’s forward guidance.