Don’t Read Too Much Into Monday’s Moves. Markets Still Look Like They’re Heading Lower.

U.S. stocks powered higher in early Monday trading, but remain in halfway towards correction territory with weakening fundamentals, following a surprise de-escalation of America’s military efforts in the war with Iran from President Donald Trump. The president said talks with Tehran allowed him to postpone a Monday deadline for the re-opening of the Strait of Hormuz for at least a week, “subject to the success of the ongoing meetings and discussions”, and the pullback of attacks on energy and power infrastructure in Iran. Iranian officials disputed Trump’s version of events, and accused the president of attempting to “reduce energy prices and buy time for the implementation of his military plans,” but investors appeared content to unwinder earlier declines that would have taken the to the lowest levels in more than six months.