Weekly Market Update

May nonfarm payrolls rose 139 thousand, narrowly beating the 126 thousand expected but slightly off the 147 thousand in April (revised down from an initial 177 thousand).  Speaking of revisions, March was also revised down by a sizeable 65 thousand jobs bringing two-month revisions lower by 95 thousand. As we seem to say every month,…

Treasury yields are lower on the heels of a disappointing ADP Employment Change Report for May which adds even more drama to the Friday BLS Nonfarm Payrolls Report. President Trump wasted no time after the release in calling for Fed Chair Powell to begin rate cuts now. So much for a quiet Wednesday! Currently, the…

Treasuries open the week a touch higher in yield even as equities look to open modestly lower.  With the calendar turning to June we’ll get the usual onslaught of updated economic reports leading up to the Friday employment report and in between Fed speak will provide some headlines with Chairman Powell on tap this afternoon….

Markets are wading through the latest personal income, spending, and inflation numbers for April with most at or near expectations.  The inflation and spending numbers were cool, as expected, but a pop in personal incomes (0.8% vs. 0.3% expected) provided a brief uptick in yields. On closer inspection the income gain was due to a…

New Treasury supply looms over the market, but the auctions this week are of the shorter variety (2yr, 5yr, 7yr), offering an easier sell than longer-dated maturities where expanding deficit/supply worries are a bigger part of the buy/no-buy decision. A 5yr auction awaits this afternoon (1pm ET), and coming on the heels of a well-received…

You may have thought it was safe to return to the somewhat calmer tariff waters vs. April, but you would be wrong.  With President Trump’s Friday morning declaration that Europe may be hit with 50% tariffs markets are in a decidedly risk-off mood. He also took aim at Apple; warning CEO Tim Cook that iPhones…

Treasuries find themselves on the backfoot today as concerns over budget deficits and fresh supply overwhelm the risk-off selling that’s occurring in equities this morning (Dow indicated down 380 points). A 5+% yield on 20yr Treasury bonds should entice buyers in today’s auction but that maturity is typically the weak link in the Treasury market…

The Friday afternoon downgrade of US Government debt by Moody’s (Aa1 from Aaa) has Treasury yields higher and a risk-off tone in equities to start the week. Moody’s (a lagging indicator per Treasury Secretary Bessent) becomes the last major rating agency to make the downgrade, and it comes as the House struggles to get past…

Treasuries open the final trading day of the week rallying after reaching some key yield levels yesterday. The buying is a sign that investors continue to find value, and perhaps more importantly that foreign buyers remain in the game, which was a fear coming after the “Liberation Day” tariff announcement. Also, the latest inflation report…

Weekend talks between the US and China produced a lowering of tariffs between the two countries for 90-days and that has sparked a robust risk-on rally to open the week (Dow futures up over 1000 points). Much like the US-UK “deal” was more a framework to quide negotiations, this new deal is also short on…

While plenty of details of the US-UK trade “deal” remain to be hammered out, and despite talking points that highlight a more limited agreement than comprehensive, the market sees an opening for more deals and that is the operative theme this morning. The attention will quickly turn to this weekend’s China meeting.   With Inflation Week…

Meeting Highlights  As widely anticipated, the Fed held the target rate range at 4.25% – 4.50%.  The updated rate forecast, or dot plot, still has 50bps in rate cuts in 2025, same as the March and December forecasts.  However, the margin is narrower. In March, 11 of 19 participants called for two or more cuts…