May 21. First half is over….
–Second quarter draws to a close with a sigh of relief as stocks staged a modest bounce and the euro rose, after again holding 115 (3rd time in a month) as the EU summit cobbled together an agreement on migration.
–Everyone passed the Fed’s stress test and can dole out money to shareholders who can use it to bet on the next Blue Apron. Not so fast Deutsche Bank US, you’re being held back and have to re-take the remedial math class, or, as we used to call it ‘Jolly Numbers’
–Today brings Personal Income and Spending, both expected +0.4. Core prices expected +0.2 mom and +1.9 yoy. Late yesterday, today’s (week 5) TY 120.25 straddle traded 14/64’s ref 120-08; not expecting any early fireworks. Yields edged higher yesterday with tens up 2 bps to 284.6.
–Reports surfaced that General Kelly may exit the Chief of Staff role this summer. A sign of more unpredictability in policy? It seems as if other nations are always being forced to respond to blind-side proclamations from Trump. A natural counter strategy would be to get out in front and provoke the US first. Global politics have the potential to become more disorderly.
–WTI slightly higher this morning. Aug/Sept calendar spread settled $1.64, a difference of 2.2% for a one-month calendar. There have to be some pretty large losses associated with this move…
