What is moving the markets this morning. Grab a coffee.
Macro
The relentless jobs market is keeping rate cuts off the table. Tuesday's JOLTS report showed April job openings surged to their highest in nearly two years—a sign the labor market remains stubbornly tight even as oil-fueled inflation accelerates. The 10-year Treasury steadied around 4.45% as traders digested the data ahead of today's ADP print and Friday's payrolls. The S&P 500 closed at a record 7,610, up a modest 0.13%, driven by AI chip strength—but the narrow rally raises questions about breadth. Markets are now pricing in virtually no chance of a Fed cut this year, with some positioning for a December hike. The macro riddle: how long can stocks climb on multiple expansion alone while the economy runs this hot?
Oil
Crude is climbing for a third straight session on renewed doubts about a US-Iran breakthrough. WTI pushed above $95 and Brent neared $97 overnight after Iranian media cast doubt on negotiations, even as President Trump insists talks continue. The issue isn't whether they're talking—it's what happens when they stop. The Strait remains effectively shut, and every week that passes tightens global inventories further. API data showed a 6.8 million barrel drawdown—if confirmed by EIA today, that's six consecutive weeks of draws. The oil curve is pricing in a slow, messy reopening, not a V-shaped recovery.
Precious Metals
Gold slipped to $4,457 overnight, down 0.7%, as stronger jobs data reinforced Fed hawkishness and dollar strength. Silver fell half a percent to around $75. The real story is what isn't happening: gold isn't collapsing despite rising real-rate expectations. That floor suggests central-bank buying and lingering geopolitical hedging are offsetting rate headwinds. Friday's payrolls will be the test—if the number comes in hot, we'll see whether that bid holds or if the metal finally gives back more of its Iran-war premium.
Natural Gas
Henry Hub edged up to $3.17, holding near recent highs as weather forecasts point to above-normal temps through mid-June, boosting cooling demand. The bigger move is what LNG export demand isn't doing. Flows to export terminals have pulled back from April's record 18.8 Bcf/d to around 17 Bcf/d amid seasonal maintenance—Golden Pass and Freeport both offline. The spring shoulder season usually sees weak prices, but this year's heat is keeping a bid under the market. Storage injections remain near-normal, keeping the surplus modest heading into summer.
US Power
Summer is arriving early, and the grid is feeling it. ERCOT's coincident peak demand on June 1st already exceeded last year's June high, signaling the 4CP season is off to a hot start—literally. Battery storage is stepping up: the grid just set back-to-back max charging records above 7,800 MW. Wholesale prices across ISOs remain range-bound for now, but the early heat wave is a reminder that this summer's load growth—driven by data centers and industrial electrification—will test every major market. Watch PJM closely; capacity costs there have spiked, and any sustained heatwave could tighten real-time pricing fast.
Agriculture
Soybeans pulled back to $11.64, down 1.4%, as favorable Midwest weather and strong South American harvests eased supply concerns. The trade is shifting from tight-supply fear to demand uncertainty. China remains the wildcard—imports are forecast to rise modestly in 2026/27, but tariff hangovers and weak crush margins are limiting upside. Corn and wheat held relatively steady, with growers eyeing weather through planting season. Tight margins persist across the row-crop complex, with projected prices near or below breakeven for many producers even after recent rallies. Government payments will be critical to farm income this year.
On the Radar Today
- ADP private payrolls (May)—consensus around 117k; watch for upside surprise after JOLTS beat.
- EIA crude inventory data—API showed -6.8M barrels; sixth straight draw would reinforce tightness narrative.
- ISM Services PMI—manufacturing rebounded in May; services data will show if the broader economy is accelerating or just energy-driven.