USD: Holds onto gains
May-18 11:28
- FX remains steady, USD is underpinned, with risk in US starting to tilt to the downside.
- ESM2 is at session low, but well within yesterday's range.
- Small support for the contract moves up to 4029.75.
- Similar for NQM2 (Nasdaq) finding some selling interest, support here, will be seen circa 12,000
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What to Watch: Housing Data, Fed Speak, Stock Earnings
Apr-18 11:13
Rates trading weaker (30YY taps 2.9589 high, 2.9338% last), curves mildly steeper (2s10s +.856 at 37.797, 5s30s +.947 at 4.802). Very light volumes w/ much of Europe out for Easter Monday, TYM2 just over 160k at the moment.
- Limited data up at 0830ET:
- NAHB Housing Market Index (79, 77) at 1000ET
- US Tsy $57B 13W, $48B 26W bill auctions at 1130ET
- Scheduled Fed speakers this afternoon:
- StL Fed Bullard on economy, policy outlook, Council on Foreign Affairs, no text, no media Q&A at 1600
- Geopol risk: Keeping eye on Russia war in Ukraine for developments. Kyiv reported several missile strikes in the Western city of Lviv - just 70km east of the Polish border, over the weekend.
- Stocks weaker, off early overnight lows (SPX emini -16.0 at 4371.50) as earnings cycle resumes. Most already announced: Synchrony Financial (SYF), Bank of NY Mellon (BK), Bank of America (BAC) all beating estimates. Coming up: Charles Schwab (SCHW) ahead the open; JB Hunt Transport (JBHT) after the close.
OUTLOOK: Monday Data Calendar: Housing Index, TBill Sales, StL Fed Bullard
Apr-18 10:25
- US Data/Speaker Calendar (prior, estimate)
- Apr-18 1000 NAHB Housing Market Index (79, 77)
- Apr-18 1130 US Tsy $57B 13W, $48B 26W bill auctions
- Apr-18 1600 StL Fed Bullard on economy, policy outlook, Council on Foreign Affairs, no text, no media Q&A
CROSS ASSET: China GDP Slows as Rolling Lockdowns Crimp Demand
Apr-18 10:10
- An understandably subdued morning, with EU and UK market holidays limiting price action and newsflow.
- China GDP data overnight came in ahead of market expectations, putting the Y/Y growth rate at 4.8% - a pace still below the Politboro target. Rolling lockdowns and a re-flaring of COVID across major industrial cities were cited, as the raft of data showed consumer spending falling at the largest clip since the initial breakout of the virus in 2020. For the first time since the resurgence of COVID, fatalities have now been reported in Shanghai.
- Conflict across Ukraine persisted over the weekend, with Kyiv reporting several missile strikes in the Western city of Lviv - just 70km east of the Polish border. The strikes are said to have resulted in a number of fatalities, and show that no part of the country is exempt from the Russian invasion despite the pullback of Russian forces into eastern territories.
- The Kremlin this morning stated that talks with Ukraine are continuing on an 'expert' level, but there remain few signs of progress. On gas payments, Moscow have stated that there remains time for payments to switch to RUB, with some settlements expected in May.
