Stocks Pare Losses on Iran Plan Report as 30-Year Hits 2004 High

Washington and Tehran are working on a plan to end the war. That's Reuters, and the outline has Iran letting shipping through Hormuz in exchange for the US lifting its blockade. It's unconfirmed. SPX pared a drop of more than half a percent and finished Thursday at 7,704.13, off 1.90, after a low of 7,662.57. Brent still rose 3.4% to $106.60. Premarket 7,731.

For the second day running the bond market ignored good news. Wednesday it was the China truce, Thursday a peace plan, and the 30-year still climbed to 5.46%, its highest since 2004, with the ten-year at 5.16%. What changed is that stocks quit following it. SPX lost 0.8% on Wednesday's yield breakout and closed flat Thursday with the long end at its worst, even as CME put roughly 70% on an October hike. The overnight bid is AI again, specifically CPUs. Anthropic signed a seven-year, $11.6 billion deal with Akamai for its CPU workloads, Akamai's up more than 18%, and AMD, Marvell, Cerebras and Intel are all higher. It's the trade Meta's Muse agent started Sep 21, when Arm, Intel and AMD ran and Nvidia barely moved. August durable goods came in flat, better than the 0.3% drop expected, and final Michigan sentiment is at 10:00.

Overnight the profile flipped. Thursday's had about nine times as much negative gamma as positive, and today's runs close to four to one the other way. Premarket sits in the middle of the heaviest positive block, 7,725 to 7,755, with the call wall at 7,745 only 14 points over and prior demand at 7,735 and 7,746 inside it. Dealers are long gamma there, so they sell the pops and buy the dips, and a pin into the wall is the default. Gamma thins past 7,763 but doesn't turn negative, so a push through would grind toward 7,780 and the record close at 7,799. The soft spot is underneath. Below 7,725 there's very little until the flip at 7,705, right on Thursday's close, and the negatives under it are shallow, with a put wall at 7,675 about a third the size of Thursday's.

The lean is long on a dip to 7,725, the bottom of the positive block, for 7,746 and 7,755. Chasing 7,731 into the wall isn't the trade, and 7,755 is where longs get sold. A close under 7,698 ends the pin and opens 7,681 and 7,672.