Morning 5-12

News.

  • Today the New York Fed will start to buy Corporate bond ETFs as part of the Virus stimulus package. No wonder every company under the sun has been issuing debt.
  • Top health officials in the Trump administration, including Dr. Anthony Fauci, will testify before a Senate committee today (WSJ) via teleconference
  • Most Experts now expect a “swoosh” not “V” shaped  rebound in economy thus pushing back till the end of ,or middle of Next year to see output levels return 2019 level. (WSJ)
  • China Inflation Data CPI 3.3 vs F/C 3.7 PPI -3.1 vs F/C -2.5 Lower PPI increase worries about Deflation and likely keep PBOC on aggressive stimulus path
  • President Trump continues to “fight” with China as he bans Funds from buying Chinese stocks, He talked about this in the past and appears to be following through. This applies to Govt. Retirement savings fund.
  • Vix closed at lowest levels since Late February
  • Federal Reserve officials pushing back (for now) against the idea of negative rates for the US. Yesterday, Federal Reserve Bank of Atlanta Dr. Raphael Bostic told the Rotary Club of Atlanta, “I am not a big fan of going into the negative rate territory” and “Negative rates is one of the weaker tools in the tool kit. I am not anticipating supporting that anytime soon”. Federal Reserve Bank of Chicago President Charles Evans told the Lansing Regional Chamber of Commerce, “At best, we’d have to study it more, but I don’t anticipate that being a tool that we would be using in the U.S.” Keep in mind that history tells us that the FOMC is a follower, not a leader, when it comes to cutting the federal funds rate. Today we hear from Bullard (09:00 ET); Kashkari (09:00); Harker (10:00); Quarles (10:00); and Mester (17:00). Tomorrow Fed Chair Powell has the dais to himself at 09:00 ET.   (MIZUHO)

The U.S. death toll from the coronavirus pandemic surpassed 80,000 yesterday as governors from New York to California took steps toward reopening businesses. In Texas, some business owners are pushing back against the state’s shutdown orders and its phased-reopening plan. The White House and the Republican-controlled Senate remain at odds with House Democrats who are pushing to complete their next aid proposal this week. The Trump administration plans to send $11 billion to states, territories and tribes to help expand testing  (WSJ)

Markets:

  Trading without a theme Stocks, Bonds, Gold, Copper oil all higher so far today Dollar the key here Down .4 %CPI today  might keep markets attention for a  few minutes  but nothing beyond that. Long end Bonds small bid Bunds heavy as More Political Turmoil in Europe between Northern Countries and Italy continue to disrupt things. Crop Report at 11:00 today, 10 year auction at noon

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