US STOCKS: Midday Equity Roundup: Cautious Optimism at Bay

As noted earlier (see 'FRANCE: RN Contemplating Censure Against Bayrou Gov't, Marginal Widening In OATs', 1214BST) the court decision barring Marine Le Pen from running for office for the next five years could pose immediate risks to political stability should the far-right Rassemblement National (National Rally, RN) look to actively oppose the minority gov't of PM Francois Bayrou in protest against the sentence. The Bayrou gov't relies on the left-wing New Popular Front (NFP) alliance and the RN not wanting to vote together in a confidence motion, as without support from both wings of the political spectrum, the required majority in the National Assembly cannot be achieved. 

• As such, in each instance of censure votes being brought against Bayrou, the measure has only been able to gain the support of one or the other. The last time that the two sides voted together was on the censure motion that deposed the short-lived gov't of PM Michel Barnier in Dec 2024.
• On 15 April, Bayrou is set to unveil "the general framework" of the options open to the gov't regarding the 2026 budget. It remains to be seen what issue, whether budgetary or pensions related, could provide the spark that sees the RN back an NFP censure motion. In any case, President Emmanuel Macron would be in a difficult position, trying to put together a gov't that could fall apart either immediately or within months given that new legislative elections will be possible from July onwards. 

GBP/USD plumbs a new session low as the WMR fix window concludes, with the price remaining weak on the seemingly clean break below both the 200-dma of 1.2813 and the 50-dma of 1.2732 today.

• 1.2654 is the key level to watch on sustained weakness. This level marks the 50% retracement for the recovery off 1.2100 and the YTD low - but we'd likely need a sustained phase of dollar strength for the next leg here - although we do note that the case for GBP underperformance through tariff volatility - which is continuing to play out here.
• Today's spot weakness means the pair has drifted through the most sizeable optionality interest for tomorrow's cut ($1.2785-10(Gbp590mln))

• US TSY 13W BILL AUCTION: HIGH 4.175%(ALLOT 70.48%)
• US TSY 13W BILL AUCTION: DEALERS TAKE 29.33% OF COMPETITIVES
• US TSY 13W BILL AUCTION: DIRECTS TAKE 4.57% OF COMPETITIVES
• US TSY 13W BILL AUCTION: INDIRECTS TAKE 66.10% OF COMPETITIVES
• US TSY 13W BILL AUCTION: BID/CVR 2.82