Trump's Russian Diesel Deal Moved Diesel, Not Crude, and SPX Opens 5 Under the 7,820 Call Wall

Trump opened the door to Russian diesel. Friday night he posted that Russia will ship more than 300,000 tons right away and 500,000 in November, under a six-month Treasury license, and on Sunday he declared an energy ceasefire between Russia and Ukraine. Russia hit a Kharkiv power plant that evening. Diesel futures are lower this morning and crude isn't, WTI up about 1% near $93. SPX closed up 0.6% at 7,811.54 Friday to finish a 1.2% week, with the Dow leading and Nvidia and AMD both closing lower. Premarket 7,815, up 3.

That's the fourth fuel move in two weeks. The SPR loan came Sept. 29, the G7 release Oct. 2, the no-strike-before-the-midterms post last Thursday, and through all of it WTI has gone from about $89 to $93. This one at least hit the product it was aimed at, but a Ukrainian sanctions official puts the first shipment at about 15 hours of U.S. demand, which is why I wouldn't lean on it. The bigger problem is Wednesday. CPI covers September, the month diesel set its $6.52 record, and the Street has headline inflation picking up from 3.4% in the last print before the Oct. 27-28 Fed meeting. The bond market is shut today for Columbus Day, so the first rates read comes Tuesday, when JPMorgan, Goldman, Citi and Wells Fargo open bank earnings.

Premarket is 20 over the flip at 7,795 and 5 under the call wall at 7,820. The wall sits on Friday's high, the 7,819 record close and prior demand at 7,817. Above it the profile doesn't thin, with 7,840 nearly the wall's size and the band from 7,825 to 7,850 carrying about three times its gamma, so I'd expect a break over 7,820 to grind higher with dealers selling into it, past the 7,845 record high to 7,850, where it drops off. Under price, 7,800 to 7,810 is chop and the real negatives start at 7,790. The put wall at 7,780 is Friday's low to the point and about a third of the call wall.

The lean is long, bought at the flip and not at the open 5 under the wall. The entry is 7,795, the flip with prior demand at 7,793, for 7,806 and then the wall at 7,820. A hold over 7,820 opens 7,833 and the 7,845 record high, slowly, on a day with no bond market and CPI two sessions out. There is no long case under 7,779, Friday's low and the put wall.