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Today, glimmers have opened the oil market as Iran moves to allow some ships through the
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street of our moves.
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Plus reports circulate of Trump's 15-point plan to end the war, though it's still unclear
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who he's talking to.
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And business confidence slips in March as the energy shock unfolds.
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This is Reuters Morning Bid bringing you unfiltered market news and analysis straight from the
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Reuters newsroom seven days a week.
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I'm Mike Dolan and London.
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And I'm Anish Mansky.
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It's Wednesday, March 25th.
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Well, Mike, we're hearing a lot of news about this potential plan to end the war.
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I believe it's a 15-point plan from Donald Trump.
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But it's slightly unclear who exactly he's talking to.
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It's a lot is unclear in this.
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But again, as we spoke about yesterday, markets want to see some movement here.
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There is a feeling that this will end at some point and there is a clear bias if you
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like towards trading a possible ceasefire.
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Now, whether that ends up from this plan or not, as you say, we don't know who the United
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States is talking to.
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But one thing they have latched onto in recent few hours of trade, at least the oil market
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has seen Brent come down below $100 barrel again.
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And that's basically on this Iranian statement to the United Nations that it will allow
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some ships of non-combatant nations.
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It says to pass through the straits of all moves, which is something it's indicated before.
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But it gives some optimism that even if there is a prolonged negotiation or even a temporary
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ceasefire, that's some oil flows through those straits.
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I mean, I do think this is another example of the paper markets being a lot more optimistic
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than what we're actually seeing on the ground in the physical markets because it's one
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thing for Tehran to put out this statement.
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It's quite another thing if you're a company to actually send your ship through to actually
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pay the insurance to take the risk.
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It's also unclear in terms of what is going to be considered a combatant.
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What's going to be considered a line with the US?
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What's not going to be considered a line with the US?
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A lot of uncertainty here.
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And again, it seems as though there's almost a positive bias as I think you were
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We usually talk about a negative bias, but where investors are really glomming on to
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any news to say, okay, this is going to end.
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This is going to get better.
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We're going to go back to normal.
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But I think there's a lot of reason to believe here that we're not getting back to prewar
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I think that uncertainty is clearly going to linger for a long time.
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If this 15 point plan that is in many reports this morning includes a one month ceasefire
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which part of those reports then that puts us in a different territory.
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But the missiles are still flying and certainly the direct conflict between Iran and Israel
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is still as hot as it has been.
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So even the United States itself were to talk of ceasefire for a period.
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It's not clear those two countries will cease any hostilities.
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And also in the background, there is these reports of US troops being on the way to
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the Gulf for what reason we can only speculate.
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And you know, I think one thing that does seem relatively clear is that this conflict is
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not necessarily very popular with the United States.
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And we're seeing this in Trump's approval ratings.
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We've got the latest Reuters, Ipsar's poll, which is a rolling opinion poll on the president's
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You know, his overall approval is down to 36%.
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That's the lowest of his second term in office.
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And very significantly his economic policy approval rating, which obviously will take in
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cost of living issues, which are very top of his agenda this year.
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That's fallen to just 29% now.
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That's the lowest Trump has had in either of his presidency's and it's actually lower
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than Joe Biden did in the previous four years.
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So again, that definitely somewhat explains why Trump probably does want to take a breather,
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does want to figure out exactly what the next step is.
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But as you said, we're getting conflicting signals on the ground.
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We're getting conflicting messages.
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But it is remarkable that both what they were talking about, US equities, or even whether
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you're talking about the crude markets, it seems like investors are really looking for
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the positive and somewhat disregarding the uncertainty and the negativity.
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I think the positivity, if we call it that, is really around this idea that the politics
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of this for Washington, at least, will dictate that it will end soon.
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And if you're certainly trading the market, whatever about invested broadly in it,
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then clearly you're looking for that moment to see how far could oil fall in the moment
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when it all ends, where will we be in six months' time?
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What are the other themes in the background, anything from AI to all the other aspects
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that were building a head esteem in the economy before this actually happened?
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Well, we're also getting some news about what businesses are thinking about everything
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We got some business survey data in yesterday.
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And on the one hand, it's relatively negative as one would anticipate.
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But there are also some slightly positive or slightly less negative than expected findings
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Well, these were what were keenly, because I think as we mentioned yesterday, a lot of
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the hard data now is effectively out of date, because it's going to be a while before
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we get any sort of real numbers from March.
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But the readings were low, as you say, business confidence has been hit, particularly in
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Europe, where I think overall for the economy at large, it's now falling to stall speed.
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I think we can say if you were to take a reading from that.
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But interestingly, manufacturers who you think would have had the biggest hit from an energy
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shock actually did okay.
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It was mostly in the service sector, which suggests that maybe households rather than factories
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are where the initial shock is being felt most.
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For today's recommended read, check out Mike's column and how the war in the Middle East
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is rattling petrodollar foundations.
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The link is in the show notes.
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