US STOCKS: S&P(ESU5) - Challenging Highs Around 6500 Going Into NFP

The Australian Office of Financial Management (AOFM) will today sell A$900mn of the 4.25% 21 March 2036 bond. The line was last sold on 16 July 2025 for A$800mn. The sale drew an average yield of 4.4476%, a high yield of 4.4500% and was covered 4.0000x. This new line was sold by syndication on 5 February 2025 for A$15.0bn.

• This week's ACGB supply is at the top end of the recent average weekly issuance of $1500-2200mn, with  A$300mn of the 4.25% 21 June 2034 bond issued on Tuesday and A$1000mn of the  3.00% 21 November 2033 bond due on Friday.
• During the first half of 2025-26, the AOFM plans to: issue a new October 2036 Treasury Bond (by syndication and subject to market conditions); conduct 2 Treasury Bond tenders most weeks; hold 1-2 Treasury Indexed Bond tenders each month.
• Issuance of Treasury Bonds (including Green Treasury Bonds) in 2025-26 is expected to be around $150 billion. Issuance of Treasury Indexed Bonds in 2025-26 is expected to be between $2 billion and $3 billion. 
• Results are due at 0200 BST / 1100 AEST.

The ESU5 overnight range was 6315.50 - 6377.50, Asia is currently trading around 6322. The ESU5 contract stalled back towards 6400 and a poor ISM services report saw it trade heavy for the whole N/Y session. The market is trying to ignore the worries about growth that would make the cuts possible but the ISM services data shows these headwinds are increasing. This morning has seen US futures open a little lower, ESU5 -0.10%, NQU5 -0.20%. Price bounced strongly off its first support around 6200/6250, I suspect bounces back towards 6350/6400 should now initially find sellers as we enter a poor period based on seasonality. A break below 6200 is needed to potentially signal a deeper correction back to the 5900/6000 area.

• (Bloomberg) - The latest ISM Services report adds to evidence that the tariff impact on the economy is only starting to show, which helps explain the dissonance between the real economic data and corporate earnings.
• Craig Fuller on X: “The freight market has been sending flashing warning signs since mid February. But since the stock market has been rallying and government data has been wrong, no one has noticed the collapse in the Main Street economy.” 
• Lance Roberts on X: ”Goldman's Cullen Morgan reveals that CTAs are now pretty much full, and the bank estimates that CTAs are long $159bn of global equities (100th %tile) and $50bn of US equities (92nd %tile). Such skews the risk of the next market move to the downside."
• Daily Chartbook on X: CTAs: "Estimates over the next week and month are skewed to the downside. We have CTAs as sellers of global equities in every scenario over the next week (concentrated mostly in Europe)."-GS 
• Keith McCullough on X: “ One of the biggest things Consensus Bears have had dead wrong is the strength (and breadth) of US Earnings Season ”

Fig 1: SPX(ESU5) Daily Chart

Source: MNI - Market News/Bloomberg Finance L.P

Taiwan’s inflows over last five days have tipped over $2bn as international flows return.  India’s fortunes have turned the other was as strong outflows continue. 

• South Korea: Recorded inflows of +$244m yesterday, bringing the 5-day total to +$442m. 2025 to date flows are -$5,125. The 5-day average is +$88m, the 20-day average is +$193m and the 100-day average of +$2m.
• Taiwan: Had inflows of +$452m yesterday, with total inflows of +$2,148 m over the past 5 days. YTD flows are positive at +$3,463. The 5-day average is +$430m, the 20-day average of +$333m and the 100-day average of +$161m.
• India: Had outflows of -$225m as of the 4th, with total outflows of -$1,537m over the past 5 days.  YTD flows are negative -$11,398m.  The 5-day average is -$307m, the 20-day average of -$169m and the 100-day average of +$35m.
• Indonesia: Had inflows of +$34m yesterday, with total outflows of -$148m over the prior five days.  YTD flows are negative -$3,781m.  The 5-day average is -$30m, the 20-day average -$15m and the 100-day average -$29m.
• Thailand: Recorded inflows of +$64m yesterday, with inflows totaling +$95m over the past 5 days. YTD flows are negative at -$1,752m. The 5-day average is +$19m, the 20-day average of +$35m and the 100-day average of -$12m.
• Malaysia: Recorded outflows as of -$75m yesterday, totaling -$155m over the past 5 days. YTD flows are negative at -$3,076m. The 5-day average is -$31m, the 20-day average of -$17m and the 100-day average of -$17m.
• Philippines: Recorded outflows of -$3m yesterday, with net outflows of -$5m over the past 5 days. YTD flows are negative at -$631m. The 5-day average is -$1m, the 20-day average of -$4m the 100-day average of -$4m.