• APAC stocks began the week on the front foot after the tech-led surge last Friday on Wall St; Japan was on holiday.
• European equity futures indicate a positive open with the Euro Stoxx 50 future +0.4% after the cash market closed up 1.4% on Friday.
• USD/JPY saw volatile trade in which it initially surged to above 160.00. The pair later saw a sharp drop and breached 156.00 to the downside despite the absence of any obvious drivers.
• Egypt offered a new proposal for a truce between Israel and Hamas in which some Israeli hostages would be exchanged for Palestinian prisoners and a three-week ceasefire.
• Looking ahead, highlights include Spanish and Germany CPI, EZ Sentiment, US Dallas Fed Manufacturing Index, Comments from ECB’s de Guindos, Supply from EZ & US Quarterly Refunding Estimates.

US TRADE

EQUITIES

• US stocks finished higher on Friday with the gains led by strength in big tech shares post-earnings, while the macro highlight was the March Core PCE data which printed in line with estimates M/M and the Y/Y reading remained at 2.8% but was slightly above the market consensus. Nonetheless, the data resulted in a kneejerk dovish reaction after the recent hot Q1 GDP Prices stoked concerns over a hot March core PCE print Friday, while it was revealed that the hot Q1 data was largely a function of upward revisions to the January figures.
• SPX +1.02% at 5,099, NDX +1.65% at 17,718, DJIA +0.40% at 38,239, RUT +1.05% at 2,001.
• Click here for a detailed summary.

NOTABLE HEADLINES

• White House said President Biden approved the Kansas disaster declaration and ordered federal assistance to supplement recovery efforts in areas affected by severe winter storm from January 8th-16th.
• Apple (AAPL) intensified talks with OpenAI for iPhone generative AI features in which they are discussing the terms of a possible agreement and how the OpenAI features would be integrated into Apple’s iOS 18, according to Bloomberg.

APAC TRADE

EQUITIES

• APAC stocks began the week on the front foot after the tech-led surge last Friday on Wall St and amid increased optimism regarding a Gaza truce with negotiators set for talks in Cairo on Monday, although Japan was on holiday and ahead of this week's key risk events.
• ASX 200 was led higher by real estate, tech and telecoms owing to softer yields.
• Hang Seng and Shanghai Comp. gained with the former entering into bull market territory after climbing over 20% from its January lows, while participants digested a slew of earnings and the mainland also shrugged off the slowdown in March Industrial Profits.
• US equity futures (ES +0.3%) extended on Friday's gains albeit with price action contained ahead of risk events.
• European equity futures indicate a positive open with the Euro Stoxx 50 future +0.4% after the cash market closed up 1.4% on Friday.

FX

• USD/JPY was volatile and initially surged to above the 160.00 level despite the lack of catalysts and absence of Japanese participants due to a holiday closure. The pair later saw a sharper drop and eventually breached the 156.00 level to the downside despite the absence of any obvious drivers, although traders later cited yen-buying intervention by Japan for the move lower.
• DXY eventually slipped in late trade beneath the 106.00 level with pressure owing to a fall in USD/JPY.
• EUR/USD gained following its return to above the 1.0700 level and alongside late USD pressure.
• GBP/USD edged higher after reclaiming the 1.2500 status and breached its 21-DMA.
• Antipodeans advanced with the upside facilitated by their high-beta statuses and a weaker dollar.
• PBoC set USD/CNY mid-point at 7.1066 vs exp. 7.2759 (prev. 7.1056).

FIXED INCOME

• 10-year UST futures lacked firm direction but remained afloat after last Friday's 'in line' Core PCE price data, while price action was quiet with cash treasuries trade closed overnight due to the holiday in Tokyo.
• Bund futures were little changed heading into the latest German inflation data due later.

COMMODITIES

• Crude futures declined amid renewed hopes of a Gaza truce following a new proposal by Egypt and with negotiators set to meet in Cairo today.
• A drone attack reportedly targeted the Khor Mor gas field in Iraq’s Kurdistan region, according to Reuters.
• TotalEnergies (TTE FP) CEO said the Co. is expected to complete the first phase of the solar power project in Iraq within the next year, while the Co. is to complete the first stage of utilising the by-produced gas from Iraq’s project during 2025 with a production capacity of 50mln cubic feet, according to Reuters.
• Turkey is in talks with ExxonMobil (XOM) over a multi-billion dollar LNG deal, according to FT.
• Spot gold was mildly pressured alongside the lack of haven demand.
• Copper futures edged mild gains amid the mostly constructive mood.

CRYPTO

• Bitcoin was pressured overnight and slipped back beneath the USD 63,000 level.

NOTABLE ASIA-PAC HEADLINES

• China's MOFCOM said export control measures proposed by Japan on semiconductors will seriously affect the normal trade between Chinese and Japanese enterprises, as well as undermine the stability of the global supply chain. Furthermore, it stated that China urges the Japanese side to rectify its 'erroneous practices' in a timely manner and China will take necessary measures to firmly safeguard the legitimate rights and interests of Chinese enterprises, according to Reuters.
• US and Taiwan are to hold in-person negotiation talks on trade beginning on April 29th, according to Reuters.
• Japanese PM Kishida said they will promote union policies for wage increases, according to Reuters.

DATA RECAP

• Chinese Industrial Profits YTD Y/Y (Mar) 4.3% (Prev. 10.2%)

GEOPOLITICS

MIDDLE EAST

• Egypt offered a new proposal for a truce between Israel and Hamas in which some Israeli hostages would be exchanged for Palestinian prisoners and a three-week ceasefire, while Egyptian officials said Israel helped create the proposal and would enter longer-term discussions once Hamas releases the first group of 20 hostages over the truce period, according to WSJ.
• Hamas said it received Israel’s official response to its position over ceasefire talks and will study the proposal before submitting its response. It was later reported that a Hamas official told AFP that there were no major issues in the group’s remarks on the truce proposal, while it was separately reported that a Hamas delegation is to visit Cairo on Monday for ceasefire talks, according to an official cited by Reuters.
• Israel’s Foreign Minister said Israel will suspend the planned operation in Rafah if Hamas agrees to a hostage deal and stated the release of hostages is their top priority. It was also reported that the Israeli military said the amount of aid going into Gaza will scale up in the coming days.
• Palestinian President Abbas said Israel will go into Rafah in the next few days and the US is the only country that can stop Israel from attacking Rafah, while he is worried that Israel will try to push Palestinians out of the West Bank after it is done with Gaza, according to Reuters.
• Medical official said at least 13 Palestinians were killed in Israeli airstrikes on three houses in Rafah in southern Gaza, according to Reuters.
• US President Biden spoke with Israeli PM Netanyahu on Sunday and reaffirmed his ironclad commitment to Israel’s security, as well as stressed the need for progress in aid deliveries to be sustained and enhanced in full coordination with humanitarian organisations. Furthermore, they discussed Rafah and Biden reiterated his clear position, according to the White House cited by Reuters.
• White House national security spokesperson Kirby said Israel assured the US that they won’t go into Rafah until the US has a chance to share its perspectives and concerns, while he added Israelis have started to meet the aid commitments that US President Biden asked them to meet. It was separately reported that US Secretary of State Blinken will travel to Jordan and Israel following Saudi Arabia, according to Reuters.
• France’s Foreign Minister said to make proposals in Lebanon to stabilise the zone and prevent a war between Hezbollah and Israel, according to Reuters.
• UKMTO said it received reports of an incident 177 nautical miles southeast of the Port of Nashtoon located in eastern Yemen on Saturday night which involved a small boat that approached a ship, although there was no harm or damage and the ship carried on its journey, according to IRNA.

OTHER

• US intelligence found that Russian President Putin did not directly order Navalny’s death in February, according to WSJ. US intelligence report does not dispute Putin’s culpability for the death of Navalny but believes he probably did not order it at that moment, while a Kremlin spokesperson called the intelligence report empty speculation.
• Russian Foreign Ministry said there will be a severe response if Russian assets are touched and it is a pity that some in the West do not understand it, while it was also reported that Russia’s Kremlin said there will be endless legal challenges if Russian assets are seized.
• Russia’s Kremlin said there are no grounds to hold any peace talks with Ukraine given Kyiv’s official refusal to conduct such talks with Russia.
• Kyiv’s top general said fighting on the eastern front worsened and Ukrainian troops had fallen back in three places.
• North Korea’s Foreign Ministry said it will make stern and decisive choices in response to the US using human rights for anti-North Korean behaviour, while it added that the US envoy on North Korean human rights is motivated politically and is considered political provocation, according to KCNA.

EU/UK

NOTABLE HEADLINES

• Scotland's First Minister Humza Yousaf is set to step down after coming to the conclusion that is position is no longer tenable, according to The Sunday Times.
• Fitch affirmed France at AA-; Outlook Stable and affirmed Switzerland at AAA; Outlook Stable, while it affirmed Sweden at AAA; Outlook Stable.