US-RUSSIA: Speaker Johnson Says He Supports Russia Sanctions Bill - Punchbowl
Jake Sherman at Punchbowl News reporting on X that House Speaker Mike Johnson (R-LA) "just reiterated he is in favor of Congress putting new sanctions on Russia." As the package has overwhelming support in the Senate, Johnson's approval would release the bill for consideration on the House floor, likely setting up passage to President Donald Trump's desk.
- The Russia sanctions bill, introduced by Senators Lindsay Graham (R-SC) and Richard Blumenthal (D-CT), would impose punitive sanctions if Moscow refuses to negotiate with Ukraine, including a 500% secondary tariff on goods imported from countries that buy Russian oil and gas.
- Trump told reporters yesterday that Russian President Vladimir Putin is, "very nice all the time, but it turns out to be meaningless." Trump said of Graham’s sanctions bill: “...it’s totally at my option and I’m looking at it strongly”.
- Graham said that Trump told him “it’s time to move so we’re going to move,” on sanctions. Senate Majority Leader John Thune (R-SD) said he’ll make an announcement soon on when the Senate will take up the bill.
- The bill is unlikely to hit the Senate this week but could come before the chamber ahead of the August recess, if an agreement is struck with the White House on language clarifying Trump's discretion on deploying sanctions and tariffs.
- The primary concern for the White House is likely how to calibrate secondary tariffs without increasing tensions with China and India – the two biggest buyers of Russian hydrocarbons.
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ITALY AUCTION PREVIEW: On offer Thursday
MEF has announced it will be looking to sell the following at its auction Thursday, June 12:
- E2.0-2.5bln of the 2.65% Jun-28 BTP (ISIN: IT0005641029)
- E2.75-3.0bln of the 3.25% Jul-32 BTP (ISIN: IT0005647265)
- E1.0-1.25bln of the 1.25% Oct-54 BTP (ISIN: IT0005611741)
The on-the-run 3Y and 7Y offerings are as we expected. We didn't have a strong conviction around which 15+ year BTP was going to be on offer alongside them.
US STOCKS: Early Equities Roundup: Narrowly Mixed, Hospitals, Insurers Lagging
- Stocks are mixed at midday Monday morning trade, inside narrow ranges with the SPX eminis and Nasdaq outperforming a mildly weaker Dow index. Relatively muted trade as markets await Wednesday's CPI release.
- Currently, the DJIA trades down 44.63 points (-0.1%) at 42718.52, S&P E-Minis up 6 points (0.1%) at 6012.75, Nasdaq up 61.4 points (0.3%) at 19591.89.
- Materials, materials, energy and tech-related stocks led gainers in the first half: Albemarle +4.50%, Enphase Energy +4.03%, Evergy +3.43%, Qualcomm gained +3.55% while Intel Corp climbed 3.46%.
- Meanwhile, health care and insurers underperformed in the first half, weaker after Goldman Sachs healthcare conference where industry leaders reported average hospital stays remain longer than pre-Covid levels.
- Laggers included Allstate Corp -4.23%, Aon -4.23%, American International Group -4.18%, Progressive -4.16%, PG&E Corp -4.16% and Arthur J Gallagher -3.24%.
US OUTLOOK/OPINION: Atlanta Fed GDPNow At 3.8% With Less Acute Inventory Drag
The Atlanta Fed's GDPNow estimate for Q2 ticks back up to 3.8% Q/Q SAAR, where it stood last Thursday before the May employment report saw a downtick to 3.7%.
- This comes after today's wholesale trade data: equipment investment has been revised up slightly (1.7% Q/Q SAAR), with the drag from inventories seen a little less acute (though no doubt seen a drag in the quarter after Q1's tariff front-running buildup).
- The downgrade Friday (no estimate was published at the time) was largely due to slightly weaker personal consumption and investment estimates. See table below.
- Reflecting the relative lack of economic activity data this week, It's a full 8 days until the next published GDPNow update (June 18).
