Happy Cinco De Mayo. The Knicks continued their prolific stretch of basketball with their Game 1 win over the 76ers yesterday. Equities, meanwhile, had some difficulty setting up their offense. Iran hostilities flared up but didn’t ignite. General Caine and Secretary of War Hegseth said missile launches and infrastructure strikes didn't reach the threshold of violating the ceasefire, but it did enough to rattle markets a little. The S&P 500 fell 0.4% but finished off its lows. The equal-weight and Russell lagged. Crude jumped 5%, applying pressure on equities, as did a backup in yields.

Today we’re seeing strength in equities, in celebration of the Knicks win and Cinco de Mayo, but also due to what didn’t happen in Iran overnight- no escalation, no responses. That lack of activity pushed oil prices lower and yields eased a bit from yesterday’s sharp move higher. The S&P is near session highs, up just under 1% with the equal-weight inline as small caps outperforming. Most sectors are higher and Value is getting the better of Growth. There’s mixed performance across high-beta, retail/thematic areas.

The commodity complex is very much the opposite of yesterday’s session with energy moving lower and the metals complex recouping some of yesterday’s losses. Gold is bouncing around $4500. Copper tested its 50/100d ma yesterday and has bounced today back over $6. Ag is down modestly. Bitcoin and Ether are continuing their strength since April. Political tailwinds are blowing as Senators Tillis and Alsobrooks released an updated compromise on stablecoin yield in the Clarity Act. Yields are down 2-3bp across the curve, taking back some of yesterday’s sharp backup in rates. The US Dollar Index is about flat.