Morning 6-4


             Dollar Bid, Eurodollars moving to lows as Aggressive rate cuts bets being pared back just a bit


  • Congressional Republicans have begun discussing whether they may have to vote to block President Trump’s planned new tariffs on Mexico, potentially igniting a second standoff this year over Trump’s use of executive powers to circumvent Congress, people familiar with the talks said
  • A bit of  A Bounce in tech stocks after yesterday’s Rout in FANNG after word that U.S. government gearing up to Investigate Amazon, apple, Google and Facebook for antitrust violations. Not new news but on a day when pessimism was high it had an outside impact on tech.
  • Australia Cut rates .25% as expected first cut in ~3 Years
  • South Korea Final look at Q1 GDP revised lower
  • Eurozone CPI missed expectations -EZ May CPI May: 1.2% y/y vs 1.3% cons  -EZ May CPI ex food & energy: 1.0% y/y vs 1.1% cons
  • UK May Construction PMI: 48.6 vs 50.5 cons
  • Corn gapped higher to open over night session as Crop progress missed expectations, corn +1.6%,Soy +1%
  • Soothing comments from Mexico and China trade reps providing  a bit of fuel to up move in Stocks this morning

Heavy Slate of Fed speak today let’s see if they Confirm the Ultra Dovish Fed rate cut path market is pricing in or they Pull back on expectations a bit, I believe the latter. Powell delivers opening remarks to the Fed conference it is possible he side steps talk of rates and Economy all together.

Calendar for the “Fed listens Conference”

  • 7:30 FRB New York’s Williams (voter, centrist) opens event on building cultural capital; New York, NY
  • 8:45 FRB Chicago’s Evans (voter, dovish) welcome and introduction at Fed Listens conference; Chicago, IL
  • 8:55 Fed Chairman Powell (voter, centrist) gives opening remarks at Fed Listens conference; Chicago, IL
  • 2:45 Fed Governor Brainard (voter, dovish) moderates panel on full employment at Fed Listens conference; Chicago, IL
  • 5:45 FRB Dallas President Kaplan (nonvoter, dovish) welcome remarks at dinner reception at Fed conference; Chicago, IL

 Treasury markets a touch too aggressive with the entire rate Cut pricing  so a bit of a pullback in prices today, ten year yields at 2.11% ,7s  right at 2%,but 2s,3s,and 5s well below 2% yield.Bunds a touch higher today  yields down 1.1 bps. BTPs also see yields lower by  5 bps. Reminder ECB meets Thursday so possibly a bit of Dovish Draghi being priced in.Only 4 more meeting then Draghi’s term is complete.

Dollar index small bid, I’m watching the Yen as most are as it takes its roll as the Global risk barometer. Copper little Changed, Gold -.3% Silver -.75% as firm Dollar weighs on Commoditties.Oil lower watch the Dec/Dec calendar spreads as the Bullishness or backwardation is being  sold out of spreads in a hurry, Not a good sign for the bulls. Z/Z/ Brent is below a $1

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

This site uses Akismet to reduce spam. Learn how your comment data is processed.