5-13

  • Consensus saying that Powell will push back against the negative rate pricing and say he is in favor of using the Feds current tools and hint that Fiscal policy can do more. Anything that goes against this consensus could result in market gyrations. Powell Speech released at 8:00 and Post Speech a Q&A will follow. Per Bloomberg “Eurodollar Options trades have emerged that target a fed funds rate -.5 by mid-2021”
  •   ICYMI: : Senator Graham is proposing a C-19 Accountability Bill; requires of China a full/complete investigation of C-19 led by the US/its allies/UN or WHO; wants certification all wet markets have been closed; authorized Pres to impose a range of sanctions
  •   Global (vs day): Total cases 4,261,955 (+2.0%); death toll 291,964 (+2.0%); cumulative cured 1,493,414 (+2.6%); active cases 2,476,577 (+1.7%) https://bit.ly/2xyIxsT
  • US Budget Deficit: $1.935Tn in 12 months through April
  • The UK Telegraph report the country is on course for a 337 billion GBP budget deficit against the 55bn that was forecast in the budget (Forex live)

 Markets:

   Dax -1% all but 1 Stock of the 30 down on day, Stoxx 600 shows all Sectors down led by Travel and leisure and Autos the Former a Virus proxy. Spoos Higher +.5%, Nasdaq +.9 % Yesterday afternoon selloff forgotten as No technical damage down so why not buy them up. One notes the FAAM group of stocks (FB, APPL, GOOG, MSFT, Amazon) now make up close to 25% of Market cap of SPX so as Big Tech Goes so do the markets

   30-year auction at noon today, bonds currently higher optimism that auction will go well. Yesterday’s 10 year Bid to cover strongest in 2 years and one of the highest in recent years all time low yields, all time high nominal amount=no problem with take down. Bunds higher, BTPs higher so strength in the latter =macro theme causing Lower European stocks, likely Company issues. ECB German Govt argumenta continue Germany also seeing an Increase in Virus cases thus may be weighing a bit on the travel in leisure group of stocks

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