US: Trump's White House Event On OBBB Underway Shortly
Jun-26 19:58
President Donald Trump is shortly due to host an event at the White House to drum up support for the 'One Big Beautiful' reconciliation bill. LIVESTREAM
- Trump will highlight the popular proposals in the package, like no taxes on tips and overtime pay and enhanced border security. He will downplay a raft of negative polling on the package.
- Politico notes: “Trump will be joined in the East Room by “everyday Americans” whom the administration says would benefit from the bill — including tipped workers, food delivery drivers and border patrol agents.”
- White House Press Secretary Karoline Leavitt told reporters that Trump is, “always ready to whip if he has to," but "hopefully he doesn't, and everyone just falls in line and gets this bill done."
- The nonpartisan Senate Parliamentarian earlier today struck a raft of key healthcare provision from the bill for non-compliance with the rules of reconciliation, including the GOP's framework for a provider tax crackdown. See: US: Parliamentarian Strikes Health Provisions From OBBB, Major Setback For GOP
- The Parliamentarian's ruling on the provider tax may bolster Senate Majority Leader John Thune (R-SD) by removing a contentious item that has sparked a major GOP rebellion against the package. But it may require the Senate to look elsewhere for savings to offset the cost of the package.
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US TSYS: Bull Flattening In Return From Long Weekend
May-27 19:51
The cash Treasuries curve bull flattened Tuesday in the return to trading after the Memorial Day weekend.
- Global core FI was roundly boosted by soaring long-end JGBs on an overnight Reuters report that the Japanese finance ministry was considering shifting its issuance profile away from long-dated paper.
- Data broadly confirmed the narrative of US economic stabilization, with durable goods orders softer but not necessarily falling off a cliff in April, and Conference Board consumer confidence surprisingly bounced in May (though the so-called labor differential weakened in a possible warning sign for the labor market).
- In supply, the 2Y Note was well digested (1bp trade-through was the best since February), helping consolidate Treasury gains through the afternoon session.
- The June/September futures roll picked up where it left off last week, with most contracts now around two-thirds complete.
- Latest cash levels: The 2-Yr yield is down 1.9bps at 3.9723%, 5-Yr is down 5.1bps at 4.0298%, 10-Yr is down 7.1bps at 4.4397%, and 30-Yr is down 9.2bps at 4.9459%. The Jun 25 T-Note future is up 12/32 at 110-14.5, having traded in a range of 109-24.5 to 110-18.
- Wednesday's calendar includes more regional Fed surveys (Richmond services/manufacturing, Dallas services) and an appearance by FOMC's Kashkari, with supply including 2Y FRN and 5Y Note. We then get the minutes of the May FOMC meeting in the afternoon.
OPTIONS: US Options Roundup - May 27 2025
May-27 19:45
Tuesday's US rates options flow included:
- SFRU5 95.87/95.75ps 1x2, with 95.93/95.75ps 1x2, bought the strip for 3.25 in 5k
- SFRZ5 96.50/97.00cs vs 95.87p, traded for 3 in 2k
- SFRZ5 96.00/65.62ps 1x2, traded 11.5 in 3.5k
- TYN5 107.5 put bought for 4 in 20k
EQUITIES: Tech, Cyclicals Lead Broad Gains
May-27 19:32
Equities were bid Tuesday with the S&P 500 experiencing a strong and broad rally, up 2% in late trade with cyclical stocks leading the way for the most part. Market breadth was positive, with 94% of securities set to finish the day higher.
- After some weakness at the cash open, it looked as though futures would be unable to advance from their gains coming into the weekend (cash was closed Monday for holidays), but the rest of the session saw a steady rally to the best levels since May 21 on a US-EU tariff reprieve and the Treasury market regaining ground.
- Leading the cash gains were growth-oriented sectors: Consumer Discretionary equities were the top performer, surging +2.7%, with Tech also saw significant gains, rising +2.4%. Communication Services followed with a solid +1.97% increase.
- NVidia (+3%), Oracle (+3.8%) and Apple (+2.6%) were notable gainers, the latter after a prolonged multi-day tariff-related selloff, and Tesla rising 5.9% to the best levels since mid-February.
- All sectors finished in positive territory. Even the day's relative underperformers posted gains: Energy was up +0.8%. Consumer Staples rose +0.9%, with Utilities up +1.1%.
