【Zhenzhuo Finance】U.S. military fires on Iranian cargo ship; Chinese e-commerce giant hit with massive fine
On the day after Iran resumed its blockade of the Strait of Hormuz, the United States attacked and seized an Iranian cargo ship. Tehran downplayed the prospects for peace talks, while crude oil futures surged at the Asian market open.
Overnight Highlights
Boosted by optimism over Iran's announcement to reopen the Strait of Hormuz and the potential for a U.S.-Iran deal, the three major U.S. stock indices closed sharply higher on Friday, with the S&P 500 and Nasdaq hitting consecutive record highs. Easing geopolitical tensions alleviated concerns about a resurgence of inflation, pushing yields on major U.S. government bonds broadly lower. In the currency market, a significant rebound in risk appetite led to an outflow of safe-haven funds, sending the U.S. dollar index to a seven-week low.
International News
The U.S. Navy attacked and seized an Iranian-flagged cargo ship during the maritime blockade for the first time. The White House said U.S. officials including Vance will meet with Iran in Islamabad on Tuesday, but Tehran downplayed the possibility of participating in talks and reaching an agreement.
Iran's brief opening of the Strait of Hormuz on Friday triggered a sharp market reaction. However, as the U.S. refused to lift the blockade, Tehran reinstated restrictions on vessel passage on Saturday, with shipowners reporting attacks on tankers. Israel launched strikes against Lebanon again during the ceasefire period.
Escalating Middle East tensions spurred Brent crude oil to surge nearly 8% in early Asian trading on Monday, while European natural gas prices rose sharply.
Federal Reserve Governor Waller stated that due to the energy shock caused by the Iran war, he is cautious about the need for near-term interest rate cuts, warning that the conflict could have lasting effects on inflation. The San Francisco Fed President hinted at supporting a hold on rates.
Goldman Sachs said that for the recent U.S. stock rally to continue, central banks need to pivot back to rate cuts.
ECB President Lagarde said risks to the inflation outlook are tilted to the upside. ECB Governing Council member Kazaks said the next interest rate move might not necessarily be a hike.
The U.S. extended the sales license period for some Russian oil, from April 17 to May 16.
White House officials met with the CEO of Anthropic on Friday to discuss using the AI model Mythos, calling the meeting "productive and constructive."
AI programming company Cursor is reportedly in talks to raise $2 billion, valuing the company at over $50 billion.
The U.S. is reportedly considering tightening auto import rules to accelerate manufacturing reshoring. Commerce Secretary Lutnick ruled out Chinese investment in the U.S. auto industry, saying the U.S. does not need companies like BYD to enter.
According to Reuters, Meta plans to cut 10% of its global workforce in late May, affecting about 8,000 employees.
Greater China News
China will maintain the issuance terms for this year's ultra-long-term special government bonds unchanged, still at 20, 30, and 50 years, with a pace similar to last year. Pressure from long-duration supply is imminent, testing market absorption capacity.
People's Bank of China Governor Pan Gongsheng said artificial intelligence is leading a new round of technological revolution and industrial transformation, bringing both opportunities and risks to the global economy.
Chinese regulators imposed administrative penalties on major e-commerce platforms including Alibaba, Pinduoduo, and Meituan for "ghost takeout," with total fines amounting to 3.597 billion yuan, for failing to screen out unqualified merchants.
Oriental Securities plans to acquire 100% of Shanghai Securities' equity by issuing A-shares and paying cash. The combined asset size of these two Shanghai state-owned brokerages will reach about $86 billion.
Hong Kong Economic Journal: CK Hutchison has no intention of selling its ParknShop supermarket chain to Jardine Matheson at a discount, and an agreement is reportedly still far off.
Abu Dhabi is reportedly considering consolidating Chinese assets held by two of its sovereign wealth funds under a new entity, laying the groundwork for a revamped China investment strategy.
The Information reported that DeepSeek is in talks for a funding round valuing it at $10 billion.
Vanke plans to hold a bondholders' meeting for bond 23 Vanke MTN002 on May 6 to deliberate on extension-related matters.
Envision AESC, a major global manufacturer of EV lithium batteries and energy storage systems, is reportedly considering an IPO in Hong Kong as soon as this year, potentially raising $1-2 billion.
The National Bank of Georgia has reportedly started buying Chinese government bonds, aiming to increase the proportion of RMB assets in its foreign exchange reserves to up to 5%.
Commodities & Forex Markets
Brent crude oil futures surged nearly 8% in Asian markets on Monday due to the renewed blockade of the Strait of Hormuz, reversing Friday's losses. Gold prices in Asia resumed their decline on Monday amid escalating Middle East tensions, after hitting a near one-month high on Friday.
Earnings & Economic Data Focus
U.S. Business Inventories MoM for Feb (Prev: -0.10%, Forecast: 0.3%)
U.S. Baker Hughes Total Rig Count for the week ending Apr 17 (Prev: 411)
Source: Golden Horse Capital Management (Hong Kong) Limited
Author: Terry Chow
Proofreader: Gloria Guo
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