Diverging data and higher oil price keep markets cautious

Summary

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Podcast Summary: Moving Markets

Episode: Diverging data and higher oil price keep markets cautious
Date: April 24, 2026
Host: Helen Frear
Guests: Luzia Cuculovic (Markets), Tim Gagy (FX & Metals)

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Overview

This episode of Julius Baer's "Moving Markets" examines the state of global markets in the face of diverging economic data and rising oil prices, with a particular focus on PMI results, corporate earnings, central bank actions, and prospects in the foreign exchange and metals markets. The conversation also highlights the effects of geopolitical uncertainties, especially around Iran, and the implications for investor sentiment and market positioning.

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Key Discussion Points & Insights

1. Diverging Economic Data: US vs. Eurozone

[00:34 – 02:18]

• US Economic Resilience:

  • Recent PMI (Purchasing Managers' Index) data show continued expansion, especially in manufacturing, which hit its strongest growth in almost four years.
  • Companies are stockpiling inventories due to concerns over disruptions linked to the Iran situation, boosting apparent demand but also fueling inflation pressures.
  • Insight: Despite strong current data, business confidence remains historically low.
  • Quote:

    "The data points to surprising resilience... Flash PMIs rose to a three month high in April... But business confidence remains subdued."
    — Luzia Cuculovic [00:48]

• Eurozone Weakness:

  • April saw the Eurozone slip into contraction for the first time since late 2024, mainly due to a sharp decline in services as consumer confidence dropped.
  • German manufacturing is relatively resilient, but higher energy and commodities prices are pushing costs up to their highest since 2000 (excluding the pandemic).
  • Quote:

    "The contrast is stark... The Eurozone slipped into contraction... Higher energy prices and rising commodity costs are pushing input costs to their highest level since 2000."
    — Luzia Cuculovic [01:42]

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2. Labor Market & Central Banks

[02:18 – 03:44]

• US Labor Market:

  • Jobless claims rose slightly but remain at low, stable levels, indicating a cooling but robust market.
  • Forecasters expect the US Federal Reserve will keep rates unchanged for now.

• Swiss National Bank Intervention:

  • The SNB intervened in FX markets to prevent excessive appreciation of the Swiss franc, though on a smaller scale than last year.
  • Policy rates are expected to remain at 0% through 2026.
  • Chairman Schlegel underscores that Switzerland’s economic outlook depends on how long conflict-driven high energy prices persist.
  • Quote:

    "The aim is clearly to limit safe haven inflows into the franc... Prolonged high energy prices, he said, could stoke inflation and weigh on growth."
    — Luzia Cuculovic [02:58]

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3. Market Recap: Equities and Corporate Highlights

[03:44 – 05:29]

• Equity Markets:

  • Europe: Stocks ticked up, with France and Italy outperforming. UK, Germany, Spain lagged.
  • US: S&P 500 pulled back after an intraday high; Nasdaq underperformed. Software stocks (IBM, ServiceNow) dragged down by weak earnings, with spillover to peers like Microsoft and Oracle.
  • Quote:

    "IBM and ServiceNow fell sharply after earnings, dragging peers like Microsoft, Oracle and Palantir lower."
    — Luzia Cuculovic [03:48]

• Strong Corporate Performers:

  • L’Oreal: Reported its fastest quarterly growth in two years.
  • Nokia: Notable Q1 earnings, boosted by rising sales and profit, with a focus on AI in optical networks.
  • Saab: Shares rose despite a fall in order bookings.

• Underperformers and Negative Headlines:

  • Meta: Announces 10% workforce cut to streamline and fund AI initiatives.
  • American Airlines: Lowers full-year outlook after a $4 billion jump in fuel costs.
  • Quote:

    "Meta is trimming about 10% of its workforce... American Airlines cut its full year earnings outlook after fuel costs jumped by around $4 billion."
    — Luzia Cuculovic [05:12]

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4. Commodities Update

[05:29 – 06:04]

• Oil:
  • Brent crude rises above $104/barrel; IEA warns of “biggest energy security threat in history.”
  • Concerns over jet fuel in Europe and rerouted trade flows.
• Gold:
  • Price dipped, pressured by a stronger dollar and high oil prices.

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5. Asia Pacific Market Update

[06:04 – 06:39]

• Most Asian markets fell except Japan.
• Japan: Core inflation rose for the first time in five months (to 1.8%), mainly due to higher energy. Bank of Japan expected to keep rates unchanged at next week’s policy meeting.

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6. Data to Watch

[06:39 – 07:09]

• UK Retail Sales: Stronger than expected.
• Upcoming Releases: Germany’s IFO Business Climate Survey, University of Michigan Consumer Sentiment (April).
• US Futures: Trading mixed.

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7. FX & Metals Markets Update with Tim Gagy

[07:18 – 09:49]

• FX Overview:

  • The past six weeks have seen currencies largely revert to earlier levels despite equity swings.
  • Eurodollar is little changed; similar story for cable (GBP/USD) and Swissy (USD/CHF).
  • Notable outperformers include Norwegian Krona and AUD, buoyed by relatively attractive yields.
  • Quote:

    "Currencies seem to revert to their previous levels... The currencies that are holding up better... are those where yield is... better than that of the US dollar."
    — Tim Gagy [07:33]

• Metals:

  • Gold: Long-term positive view; volatility means there are opportunities in structured products, but direct buying isn’t favored immediately.
    • "The resumption of the uptrend is not clear yet... I’d prefer not to buy gold directly... but I would stay long." — Tim Gagy [08:50]
  • Silver: Remains volatile; suggest small positions.
  • Platinum/Palladium: Prefer to wait — “palladium has just been completely forgotten.”

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8. Central Bank Outlook: Next Week’s Meetings

[09:49 – 11:28]

• Fed, BOE, ECB:

  • First comprehensive meetings since escalation of Middle East conflict; impacts yet to be fully realized.
  • No policy changes expected, but communication will be key as markets reassess inflation and energy risks.
  • Removed expectations for near-term Fed rate cuts.
  • Quote:

    "Even if they don’t have much more clarity, we have had time to see impacts on energy prices... While I don’t really expect any action... I do think they will have to adjust what they say."
    — Tim Gagy [09:56]

  • Markets will listen closely to Powell, Bailey, and Lagarde for signals.

• Memorable Moment:

  • Tim shares a wry market-related joke about "the outlook" and uncertainty, offering a lighter close to his segment.

    "The doctor said, ‘I’m afraid the outlook is really very bad.’ My friend said, ‘Oh gosh... how much time do I have left?’ And the doctor said, ‘5.’ My friend said, ‘But 5 what?’ And doctor said, ‘4.’"
    — Tim Gagy [11:28]

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Notable Quotes & Moments

• "It’s a somewhat paradoxical picture in the US, with strength at the moment but tempered optimism." — Helen Frear [01:32]
• "Currencies seem to revert to their previous levels even as equity markets go from pain and panic to all-time highs." — Tim Gagy [07:33]
• "IEA is warning of the biggest energy security threat in history…" — Luzia Cuculovic [05:34]
• "Meta is trimming about 10% of its workforce as it streamlines operations and reallocates spending towards AI." — Luzia Cuculovic [05:12]

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Timestamps for Key Segments

• Diverging PMIs US/Eurozone: [00:34 – 02:18]
• Labor/Swiss Central Bank: [02:18 – 03:44]
• Equity Recap & Corporate News: [03:44 – 05:29]
• Commodities: [05:29 – 06:04]
• Asia Pacific Summary: [06:04 – 06:39]
• Data to Watch: [06:39 – 07:09]
• FX Markets (Tim Gagy): [07:18 – 09:49]
• Central Bank Outlook: [09:49 – 11:28]

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Tone and Takeaways

The episode strikes a pragmatic, slightly cautious tone, reflecting uncertainty due to geopolitical turmoil and its knock-on effects on inflation, energy, and risk sentiment. While there are pockets of strength (US manufacturing, select stocks, oil-linked currencies), the general mood is measured, as markets await further clarity from central banks and evolving global developments.

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For more daily and thematic market insights, listeners are encouraged to subscribe and listen regularly to "Moving Markets."

Transcript

[A]

Good morning everyone and welcome to Julius Bear's Moving Markets podcast. It's Friday the 24th of April and my name is Helen Frear. My first guest this morning will be Luzia Cuculovic and she'll be giving us a roundup of the latest news in financial markets. And Tim Gagy is back, so he will be my second guest this morning and he'll be filling us in on the latest moves in FX and metals markets. But first up with the market news, it is Lucia. Good morning, Lucia. Thank you for joining me.

[B]

Good morning, Helen.

[A]

Global signals yesterday were sort of mixed. Looking at the macro picture, we saw a clear divergence between the US and the Eurozone in the latest PMI data. Can you talk us through that first please, Lucia?

[B]

Yeah. So Starting with the US, the data points to surprising resilience. Flash PMIs rose to a three month high in April, signaling expansion. Manufacturing stood out, posting its strongest growth in almost four years. Companies appear to be preparing for potential disruptions linked to the situation in Iran by building inventories. That precautionary stockpiling is boosting demand, but it is also pushing prices higher with inflation pressures back at levels last seen in mid-2022. Now, despite that strength, business confidence remains subdued with expectations still historically low.

[A]

So it's a somewhat paradoxical picture in the US with strength at the moment but tempered optimism. How does that compare with Europe?

[B]

So the contrast is stark, Helen. The Eurozone slipped into contraction in April for the first time since late 2024. The main drag came from services which slowed sharply as consumer confidence weakened amid the in Iran, while German manufacturing held up reasonably well. Services weakened considerably, similar to the us Price pressures are mounting across the board. Higher energy prices and rising commodity costs are pushing input costs to their highest level since 2000, excluding the pandemic period.

[A]

Moving on to the US labour market, we got jobless claims numbers yesterday. Any noteworthy trends there?

[B]

So initial jobless claims ticked up slightly, exceeding expectations, but remain at subdued levels. Continuing claims also edged up marginally. So overall the labor market appears to be stable, slightly cooling and showing no cracks. Some think that the absence of widespread layoffs supports the expectation that the US Fed will not change rates this year

[A]

and the Swiss national bank seems to be taking steps to manage the franc's strength. What's happening there?

[B]

Yeah, Helen. So the recent balance sheet data suggests the S and P intervened in the FX market in March, though on a smaller scale than during last year's tariff related turmoil. The aim is clearly to limit safe haven inflows into the franc. Our economists expect the S and D to step in again if needed, while keeping the policy rate at 0% through 20, 26 and 20. Staying with the S and P. Chairman Schlegel also warned in an interview today that Switzerland's economic outlook depends heavily on how long conflict driven energy price pressures last. Prolonged high energy prices, he said, could stoke inflation and weigh on growth.

[A]

All right, and turning to equity markets, how did things play out yesterday?

[B]

European stocks ticked slightly higher, but sentiment remained cautious. France and Italy outperformed, while the UK, Germany and Spain saw losses. In the US stocks pulled back. The S&P 500 slipped after briefly touching a new intraday high, while the Nasdaq underperformed. Software stocks were hit particularly hard. IBM and ServiceNow fell sharply after earnings, dragging peers like Microsoft, Oracle and Palantir lower.

[A]

And speaking of specific companies, l' Oreal and Nokia stood out as strong performers yesterday. What drove gains for these stocks?

[B]

So L' Oreal delivered its fastest quarterly growth in two years, sending shares soaring. Nokia, meanwhile, benefited from robust first quarter earnings, fueled by a 4% year on year increase in net sales and a substantial jump in operating profits. Their CEO highlighted opportunities in AI, particularly within optical networks. Interestingly, even defence giant Saab saw its shares rise despite a dip in order bookings and that's attributed to a shift towards more medium sized contracts.

[A]

And then on the flip side, we also saw some negative headlines with Meta cutting jobs and American Airlines lowering its guidance.

[B]

That's right, Meta is trimming about 10% of its workforce as it streamlines operations and and reallocate spending towards AI. Meanwhile, American Airlines cut its full year earnings outlook after fuel costs jumped by around $4 billion.

[A]

Let's talk about commodities quickly, Lucia. Oil prices continue to climb.

[B]

Yes they do. So Brent crude topped $104 per barrel yesterday and is even higher this morning. The IEA is warning of the big biggest energy security threat in history, highlighting potential disruptions to jet fuel supplies in Europe and the need to reassess trade routes. The gold price dipped slightly yesterday and is again lower this morning. It is pressured by a strengthening dollar and those elevated oil prices.

[A]

And in today's Asia Pacific trading session, most markets are in the red with Japan being the notable exception. What's driving that?

[B]

Yeah, Japan's Nikkei and Topics both moved higher after core inflation accelerated for the first time in five months in March, rising to 1.8%. Higher energy prices are a key factor. This inflation data will be closely watched by the bank of Japan at next week's policy meeting where policymakers are still widely expected to refrain from raising interest rates.

[A]

All right, let's look ahead then. What key data releases should investors be paying attention to today?

[B]

So we've just got UK retail sales for March, which came in much better than expected. Later today, attention turns to Germany's IFO Business Climate Survey as well as the final reading of the University of Michigan consumer sentiment for April. As for US Stock futures, they were trading mixed when I last checked. So let's see what the day has in store for us.

[A]

Wonderful. Thanks a lot, Lucia, for the great roundup this morning.

[B]

Thanks for having me, Helen.

[A]

And now over to you, Tim. Good morning. Firstly.

[C]

Good morning, Alan.

[A]

So great to have you back on the show. Tim, after your break, what has struck you most, would you say about how the markets have evolved over the last six weeks?

[C]

Thanks, Helen. It's nice to be back. Well, the main thing that I would see is how little has changed really, especially taking a look at fx. Once again, currencies seem to revert to their previous levels even as equity markets go from pain and panic to all time highs. Euro dollar was 116 when I left and it's not really up much above 116 now. So even if we did see 114 and 118 in the meantime, nothing really happened there. Same story in cable, same story in $Swiss, there's a few outperformers. Norwegian Krona for example, which makes sense given the continued pressure on oil prices. But apart from that, it's just directionless. I think it still reflects the same theme and the same problem that we've been wrestling with for quite some time, which is when fundamentals continue to collide with yields, everyone still wants to short the dollar and the reasons why have not changed. But the trouble is, especially against the euro and the Swiss franc, it's very expensive to sell dollars. Same story for the yen, naturally. So it's not for nothing that the currencies that are holding up better, such as the Aussie dollar, the Norwegian Krono and some emerging markets, are those currencies where yield is at worst equal to and in some cases better than that of the US dollar. So for that reason I would continue to favor these currencies and I think this is a story that's just going to continue to be the case.

[A]

Metals have come under pressure again. Do you think this presents any opportunities?

[C]

Yeah, I do. I mean, we still have a positive longer term outlook on gold. Volatility has held up reasonably well, so you can still pick up A decent coupon in a reverse convertible, for example, with a strike that's quite conservative and I think I'd prefer not to buy gold directly. The resumption of the uptrend is not clear yet and already we're down about 150 odd dollars from middle of the week. So it's not quite clear yet that right here is the perfect entry point. But I would stay long and I think there's a bit of an opportunity. I think the other metals though, it's all a bit tactical. Silver's intraday swings are not as wild as they were earlier in the year, but $4 on the day yesterday is not bad and could be painful if you get it wrong. So I would really keep any trail in silver quite light in size. Platinum got a bit sticky around 2000 and there I think I'd probably rather wait. And palladium has just been completely forgotten, so I think I would really just focus on looking for opportunities in gold where the fundamental picture is the clearest.

[A]

And next week there's the main central banks meeting. Do you foresee any surprises there?

[C]

This is hard to say. I mean, it'll be very interesting to hear from the Fed, the Bank of England and the ECB for the first time proper since the war began. I mean, we did have meeting shortly after the first attacks, but last time they didn't really have any time or information. And this time around, even if they don't have maybe much more clarity, we have had time to see impacts on energy prices and to see that the flow of goods in the Strait of Hormuz is going to be greatly reduced for some time. It's still early to know the real effects on inflation, but with oil prices already higher, the outlook is different. And while I don't really expect any action from any of the three central banks, I do think they will have to adjust what they say and will have to try and give some direction to the market about what they expect to happen and what they might need to do. So far the market's not really pricing in anything in particular, but the rate cuts that were priced in for the Fed are long gone, naturally, which means that any potential hikes from the ECB in particular are going to be much less impactful for those currencies against the dollar and be another reason why I think it's going to be difficult to really see much weaker dollar. But we're going to need to listen very carefully to Powell, Bailey and Lagarde next week. Finally, Helen, my friend went to the doctor last week and the doctor said, I'm afraid the outlook is really very bad. My friend said, oh gosh, doctor, I mean, how much time do I have left? And the doctor said 5. My friend said, but 5 what? 5 years? 5 months? And doctor said 4.

[A]

Very good. Thank you, Tim. Great to have you back on the podcast this week. So that is all for today. Thank you again to my guests this morning and thank you all for tuning in. Please subscribe to our show if you enjoy it and you can of course also leave us a review on whichever platform you like to listen on. So we'll be back again on Monday morning. Do join us then when Jan Bop will be your host, joined as always by more of our colleagues to talk about what is moving markets. But until then, I wish you all a great day and then a great weekend. Bye for now. The information and opinions expressed in this podcast constitute marketing material and are not the result of independent financial or investment research. Please refer to www.juliusbear.com legal podcasts for further other important legal.