Morning 4-20


  the People’s Bank of China cut its benchmark interest rates by 20 bps to a record low of 3.85%, in line with market consensus. This was the second-rate reduction this year, as policymakers sought to shore up the economy battling with the COVID-19 outbreak after it contracted by 6.8% yoy in Q1(Trading Economics)

  May Crude oil which Expires tomorrow down 38%!!!  Trading $11.25. June down12%   Some Color from Bloomberg ““As WTI futures have tumbled, it has opened up a discount of almost $9 a barrel to the June contract, to which most trading has now transferred. Buyers in Texas are offering as little as $2 a barrel for some oil streams, raising the possibility that American producers may soon have to pay customers to take crude off their hands, particularly as landlocked producers struggle to find homes for their oil.” A change in USO ETF Rules might be weighing on May also with usual Expiration Games being played Who knows how low May Contract could drop

  • Congress close to agreeing on another $500B Stimulus, Small Business Recuse package
  • Shake Shack Will return its entire $10M loan from the Government after widespread criticism on who get loans and who didn’t. Ruth Chris also in the spotlight after they received a generous loan as well.
  • Mexico Cut to Junk by Moody’s along with a downgrade to Pemex. Drop in Crude not helping matters either peso -2% Vs USD

Markets A Bit of Risk off to start week

 80 SPX companies to report earnings this week,15% of Companies have announced they will not provide guidance due to uncertainty. Earnings could be ugly thus Stocks taking the sell first approach and ask questions later. Spoos -1.8% Nasdaq -.9% Stoxx -1% dax -1.1% NKY closed down 1.17%   treasures a small bid But European 10 year yields all higher this morning Italy +14 bps Portugal and Spain +9 Bunds Little changed. Spain said economy could shrink 12.4% and Italy leaning towards selling more Debt weigh on Bonds. Copper -.5%   Gold steady to higher.

Remember that QE treasury purchases are down to $15B!!! 20-30 QE reverse auction will take place every other day now instead of Daily

Virus (WSJ)

  • Confirmed cases world-wide have passed 2.4 million, and deaths have topped 165,000, according to data from Johns Hopkins University.
  • Infections in the U.S. surpassed 759,000, and deaths topped 40,600.
  • New York state plans to start tests aimed at estimating what percentage of its population has been infected.
  • Turkey now has the third highest amount of Cases after Europe and USA

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