Today
Stock futures pointing higher with U.S. equities extending the rally sparked by optimism around a potential U.S.–Iran deal, after Trump said talks between the two sides could resume this weekend and that he could make an appearance. Markets continued higher in yesterday’s session, with the S&P 500 and Nasdaq reaching new highs, supported by strength in tech, which is rebounding after earlier pressure tied to AI disruption concerns. The Nasdaq rose 0.4%, marking its 12th consecutive day of gains, the longest streak since 2009, and is on track to finish the week up about 5%, with the S&P 500 up roughly 3%. Canadian equity futures are also moving higher. While the TSX closed slightly lower yesterday, it remains on pace to finish the week up around 2%.
Luxury under pressure. The Iran war is weighing on the global luxury sector, with major brands seeing declining sales due to reduced Middle East demand, weaker tourism, and rising costs. Earlier this week we saw LVMH report revenue declines as the conflict disrupted a key high-spending region, while Kering and Hermès also saw weaker performance. The conflict has forced many companies to close stores, further weakening sales in the region. The Middle East is known for luxury spending, both locally and through travelling consumers, amplifying the global impact. Beyond retail, luxury automakers and supply chains are also being affected by logistics disruptions tied to the Strait of Hormuz, exposing the sector’s sensitivity to geopolitical shocks.
So is private credit. Private credit markets are facing growing pressure as Wall Street banks tighten lending terms, raising borrowing costs and increasing scrutiny on collateral amid rising market volatility. Major lenders are marking down loan values and forcing funds to swap out weaker assets, reducing flexibility and potentially eroding returns for investors. These moves come as private credit funds already deal with rising redemption requests and concerns about loan quality, particularly in sectors vulnerable to disruption like software. While banks are looking to protect themselves and limit downside risk, the shift could lead to lower returns, fewer new deals, and additional stress across the $1.8 trillion private credit market if conditions worsen.
According to Goldman Sach’s latest hedge fund report, hedge funds are on track for their strongest monthly performance in over a decade , rebounding from March’s Iran war-driven market turmoil. Equity long-short funds have gained about 7.7% this month, marking their best showing since 2016, and are up roughly 6.7% year-to-date, with Asia- and China-focused strategies leading returns. Despite earlier losses, hedge funds outperformed traditional portfolios during the volatility, losing less than a typical 60/40 mix, while also attracting their largest inflows since 2022. The environment has also driven greater dispersion in returns across individual hedge funds, highlighting a widening gap between top-performing and underperforming managers.
Cloudy outlooks. Germany has downgraded its economic outlook, cutting its 2026 growth forecast to 0.5% and 2027 to 0.9%, while raising inflation expectations as higher oil and gas prices from the Iran war weigh on the economy. Inflation is now expected to rise to around 2.7–2.8%, which would likely slow consumer spending and further strain growth. Europe’s largest economy is already struggling with structural challenges, including weaker exports, rising global competition, and persistent energy costs, with trade no longer expected to support growth in the near term. While a resolution to the Iran conflict could help, the country may still face a stagflation-like environment, with slower growth and higher inflation.
China’s growth is also expected to slow but comes after its economy grew 5% year-over-year in the first quarter, beating expectations and marking a solid rebound from late 2025. The growth was helped by strong exports, industrial output, and government-led investment. However, the details point to underlying weakness, with retail sales and fixed asset investment missing forecasts and the property sector remaining deeply negative. While the impact of the Iran war has so far been limited thanks to ample oil reserves and diversified energy supply, economists expect growth to slow in coming quarters as higher input costs and weaker global demand weigh on activity.
If your weekend wasn’t already busy enough, the NHL and NBA playoffs both kick off this weekend, once again splitting attention across two leagues at the same time. Unlike the NFL and MLB, where the postseason isn’t competing with another league’s playoffs, this Spring stretch always forces some channel flipping. For Canadian basketball fans, the Raptors open against the Cleveland Cavaliers, a matchup that may stir memories of the LeBron James years, though times have clearly changed. On the ice, Canadian representation is solid, with the Canadiens, Oilers, and Senators all in the mix. Plenty to watch, and probably not enough time.
Diversion: Couldn’t see that coming… 
