FED: US TSY 17W AUCTION: NON-COMP BIDS $509 MLN FROM $72.000 BLN TOTAL

• US TSY 13W AUCTION: NON-COMP BIDS $1.890 BLN FROM $92.000 BLN TOTAL

South Carolina Governor Henry McMaster (R-SC) is expected to hold a press conference at 16:00 ET 21:00 BST to announce his pick to replace the late Senator Linsday Graham (R-SC), who died suddenly on Saturday. A speedy pick to fill the seat would reduce the potential for gridlock in the Senate with a raft of key legislation pending, which has been compounded by Senator Mitch McConnell’s extended medical absence. 

• McMaster’s selection will fill the seat through the end of Graham's term on January 3, 2027. In the meantime, a special primary election will be held to select a Republican candidate to stand for a full six-year term at the midterms in November. The primary is likely to take place on August 11, with a runoff on August 25 if no candidate wins outright.
• President Donald Trump wrote on Truth Social a short time ago, “I recommended, to Governor Henry McMaster, Lindsey Graham’s wonderful sister, Darline, to serve as interim Senator from the Great State of South Carolina. This would be a fabulous tribute to Lindsey...”
• The primary is expected to be competitive, with a diverse range of politicians tipped to enter the race, including Trump-endorsed gubernatorial candidate Pamela Evette, conservative Rep Ralph Norman (R-SC), and former House Reps Trey Gowdy and Nancy Mace.
• According to Polymarket, Gowdy is the slight favourite after picking up an endorsement from Senate Banking Committee Chair Tim Scott (R-SC) on Sunday. As the state is overwhelmingly Republican, whoever wins the primary is likely to be elected with a strong majority in November.  

• US equity indexes trade weaker ahead midday, risk sentiment souring after Pres Trump reinstated the blockade against Iran through the Strait of Hormuz Monday, while imposing a "rate of 20% on all cargo shipped, for any and all costs necessary to do the job of providing safety and security to this very volatile section of the World”.
• Currently, the DJIA trades -0.15%, SPX emini -0.35%, Nasdaq -0.8%.
• Information Technology sector stocks led declines in the first half, semiconductor makers underperforming: Marvell Technology -6.2%, Lam Research -4.4%, Micron Technology -4.35% and ON Semiconductor Corp -4.2%.
• On the positive side, the Energy sector outperformed, buoyed by oil and gas stocks with crude prices rising (WTI +3.15 at $74.56/bbl. The following trade 3-3.75% higher ahead midday: Marathon Petroleum Corp, Valero Energy Corp, Texas Pacific Land Corp Phillips 66 and Halliburton Co.
• Reminder, the latest equity earnings cycle kicks off Tuesday with Goldman Sachs, Bank of America, JP Morgan, Wells Fargo and Citigroup reporting.