Wall St Engine

$SAP CEO Christian Klein said defense is now the company’s fastest-growing business as military budgets rise globally, and the sector now makes up about 10% of SAP’s revenue.

SWISS GOVT: NO ARMS EXPORTS TO US DURING IRAN WAR

Wall Street heads into a $5.7 trillion triple-witching options expiry on Friday, the biggest March expiration in Citi data back to 1996.

U.S. Energy Secretary Wright: Unsanctioned Iran would be absorbed in the next 30-45 days... with unsanctioning, oil will start arriving in ports. - FBN

Fed rate hike odds on Polymarket have been gradually moving up

Amazon $AMZN is developing a new mobile phone, its first since the Fire Phone, with AI and Alexa integration at the center. The project is internally called “Transformer,” though the report says it could still be scrapped. Source: Reuters

RUSSIAN CENTRAL BANK CUTS KEY RATE TO 15.00%; EST. 15.00%

BofA Downgrades $MOS to Neutral from Buy, Lowers PT to $30 from $33 Analyst comments: "We are downgrading MOS to Neutral from Buy as margin expansion in phosphate fertilizers is likely delayed a year. We have been bullish on phosphates and expect prices to sustain higher highs over time; however, the conflict in Iran is proving inflationary for raw materials, namely sulfur and ammonia, creating a difficult backdrop for profits. With cash flow hindered by another year of elevated capex, and a muted earnings inflection, we expect shares could be rangebound until a better backdrop emerges. This is unfortunate, as we believe spot margins were set to inflect materially just as the Iran conflict started. We remain bearish on ammonia longer term and expect material sulfur demand destruction should drive prices lower. However, we need the Strait of Hormuz to remain open for this to play out, and both could have material upside over the near term given the conflict and fallout to energy infrastructure. This means margin expansion is more of a 2027 story, and thus we wait for more clarity to emerge." Analyst: Steve Byrne

Goldman Sachs: ‘We See Continued Risks of an Equity Correction and Think the Buffer From Bonds Will Remain Limited Near Term’ Analyst comments: "After a bullish start to the year, with our Risk Appetite Indicator (RAI) shifting above 1, a combination of concerns about AI disruption, private credit, and more recently sharply higher oil prices and the Middle East war has weighed on risk appetite. Expectations of a continued 'Goldilocks' backdrop have faded quickly due to the resulting energy price shock and a sharp hawkish repricing of central bank policy paths. This has weighed on multi-asset portfolios with a limited opportunity set for diversification, and the risk of a larger 60/40 portfolio drawdown, a 'Balanced Bear,' has increased. We shifted tactically, over three months, to a more defensive stance in our asset allocation shortly after the conflict escalated (overweight cash, neutral equities/bonds/commodities, underweight credit). We see continued risks of an equity correction and think the buffer from bonds will remain limited near term. We remain modestly pro-risk in our asset allocation for 12 months (overweight equities, neutral bonds/commodities/cash, underweight credit). In the case of a larger 'risk-off' move, for example if our Risk Appetite Indicator drops closer to -2, we would look to add risk, especially for longer investment horizons. Since the start of the Middle East war, our World portfolio proxy, tracking roughly US$300 trillion of global assets, has lost about US$11 trillion, or about 4%. This is still a small drawdown in a long-run context. The deepest drawdowns happened when the growth/inflation mix was very unfavorable due to high and sticky inflation during the 1970s and 2022, or when they coincided with deep equity bear markets such as the Tech Bubble and the Global Financial Crisis. Markets have mostly priced a rate shock but limited growth risks so far. With current macro conditions and our baseline of a normalization in energy prices from Q2, we think the risk of a sustained, large 60/40 drawdown is still limited. Historically, compared to the start of large energy price shocks, inflation is lower, yields are higher, and growth is still good. However, to mitigate continued stagflationary risks, we recommend adding more robustness in multi-asset portfolios through allocations to defensive, quality equity styles, and selective safe assets such as gold, Treasury Inflation-Protected Securities, and Swiss franc. Considering high uncertainty, we screen for option hedges for both left and right tails. To hedge downside growth risks, CDS payers, equity puts, and puts on AUD/JPY and NZD/JPY appear attractive, while puts on U.S. high-yield and emerging-market credit might offer an attractive payoff in a stagflation scenario. To hedge right-tail risk, we prefer equity to credit upside and like selective regional/sector call switches and longer-dated calls."

TRADERS FULLY PRICE THREE RATE HIKES FROM ECB THIS YEAR

XPeng posted its first-ever quarterly profit, but the market is looking past that after weak Q1 guidance, according to Bloomberg. $XPEV guided Q1 revenue to 12.2 billion to 13.3 billion yuan, below the 15.7 billion yuan consensus, and deliveries of 61,000 to 66,000 vehicles.

USDJPY

ByteDance has agreed to sell mobile game studio Moonton to Saudi-backed Savvy Games for about $6 billion, according to Bloomberg. The deal values Moonton above the roughly $4 billion ByteDance paid in 2021 and fits ByteDance’s broader push to focus more on generative AI.

Bloomberg reports India 🇮🇳 is set to become the first major market flooded with generic semaglutide, with Natco planning copies starting at 1,290 rupees, or about $14 a month, versus $NVO Wegovy at about 10,480 rupees, or $113, in India.

Bloomberg reports OpenAI is developing a desktop app that would combine ChatGPT, Codex, and its AI browser Atlas into one product. The standalone ChatGPT app would still remain available.

HSBC Upgrades $CVX to Buy from Hold, Raises PT to $215 from $180 Analyst comments: "We upgrade Chevron from Hold to Buy with a raised price target of $215. Chevron’s shares have modestly lagged Exxon year to date despite a much lower exposure to the broader Middle East region. Only 4% of Chevron’s upstream production comes from the region, mostly in Israel (Leviathan and Tamar gas fields, which were shut in as a precaution in early March) plus some production from the Saudi-Kuwait Partitioned Zone. Chevron is not among the companies with announced growth ambitions anchored in the Gulf states. In the downstream, Chevron has minority stakes in Qatari and Saudi chemical plants via its 50% stake in CPChem." Analyst: Kim Fustier

Oppenheimer Upgrades $FRPT to Outperform from Perform, Initiates PT at $80 Analyst comments: "We are upgrading FRPT shares to Outperform from Perform and installing an $80 price target. Last March, we downgraded FRPT shares on concerns of slowing growth, and at the time, limited visibility on the company's ability to stabilize top-line trends. Following the 10%+ pullback on 3/17 driven by concerns of new competition from Costco's Kirkland Signature brand, we now see a more attractive risk/reward. A few key factors support our now more upbeat views: 1) we are increasingly confident in management’s ability to stabilize top-line trends, at least in the high single digits, even with new competition; 2) a more attractive valuation following the recent pullback; and 3) optionality from a potential takeout down the road as leading pet players adjust portfolios to incorporate fresh products." Analyst: Rupesh Parikh

Mizuho Upgrades $CMG to Outperform from Neutral, Raises PT to $40 from $37 Analyst comments: "We see a comp inflection near-term along with incremental margin visibility, with Q1 earnings and Q2-to-date commentary a potential positive catalyst. One, based on the strength of our checks, we increase our Q1 same-store sales growth estimate to 0.0% from (0.4)% versus consensus of (1.1)%. Importantly, trends strengthened as the quarter progressed, pointing to Q2 traffic/comp upside as well (1.5% MSUSA; 0.7% consensus). Two, early success of ongoing comp initiatives, including incremental value focus, increased marketing/promotional cadence, and incremental menu innovation, points to further comp acceleration as 2026 progresses, particularly with easier year-over-year compares ahead. Three, CMG's year-long cycle of lower margin revisions is almost at an end. Lastly, valuation is an overly pessimistic reflection of CMG's mid-teens long-term EBITDA growth algorithm. Therefore, we upgrade to Outperform from Neutral and increase our PT to $40 from $37. We slightly increase our 2026 EPS estimate to $1.12 from $1.11 (Q1 to $0.24 from $0.23)." Analyst: Nick Setyan

Reuters reports Tesla $TSLA is in talks to buy about $2.9 billion of solar manufacturing equipment from Chinese suppliers as it works toward 100 GW of U.S. solar capacity by the end of 2028.

Today's Key Events (All EST) — 03/20/2026 13:00: US Baker Hughes Total Rig Count 16:00: Monthly OPEX (Triple Witch) Before Open 👇 04:00: XPeng $XPEV 06:00: BitFuFu $FUFU 07:00: Milestone Pharmaceuticals $MIST B.O: Ermenegildo Zegna $ZGN