Macro Updates 20/05/2024 Trading Markets
The very last post from previously, before I carry on another one
https://medium.com/@kiann00/macro-updates-06-05-2024-trading-markets-qra-and-fomc-060b2fe285f6
- Markets (Current Week, and maybe past week moves)
- Key Events of the past week
- Key Events of the coming week
- Any trading strategy/thoughts
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- Markets (Current Week, and maybe past week moves)
US yield curve flattened, with the 10y down -13bp on the 14th May, where US CPI (finally) came in at expectations of 3.6% which was LOWER than the previous month of 3.8%. The market had been anguishing over the fact US CPI downtrend had stalled at 3.8% and been holding at that level for 3 months.
Post the rally, yields slowly crept back up to 4.42%; partly on the strength of the SPX ATH rally. On Thursday, jobless claims came in at 222k as expected, while Industrial Production YoY tanked -0.38% MoM.
Towards the end of this earnings season, Walmart outperformed expectations with profit of $0.6bn vs $0.5bn expectations and revenue of $161bn. Given Walmart is a consumer food company though, the outperformance was mainly due to the elevated US CPI over the past year.
In the Eurozone, ECB Schnabel stated after 1st June rate-cut, the July 2nd rate cut would be too soon; sending 10y to 2.52%.
In other risk assets, the rally in US yields sent DXY weaker (cable to 1.27) while Gold went back above $2.4k/oz, partly on the back of Ukraine losing the War. SPX above $5.3k.
2. Key Events of the coming week
The two US key events coming will be on Thursday 23rd May
- the US 20y auction, where market tracks the on-going demand for US treasuries
- The US FOMC Meeting minutes, for the thoughts of each of the voting members.
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