The USD is marginally higher to start the North American session. The USDJPY continues to hold the bullish bias and tests multi-decade highs at 161.95. The high reached 161.94 just short of that level. The currenl price is just below that level at 161.88. The EURUSD and GBPUSD both threatened to push higher toward the falling 100 hour MAs, but has reversed lower (higher USD).
US stocks are higher in pre-market trading with the shove coming for Micron earnings which blasted through the expectations. The futures are implying:
- Dow is up 185 points
- S&P is up 59 points
- Nasdaq is up 648 points
Micron shares are up 17.70% and other chip stocks are on the bandwagon.
- Intel +4.82%
- Broadcom+1.18%
- AMD +3.83%
- Texas Instrument +2.6%
- Sandisk +1552%
Looking at the US yield curve yields are marginally higher:
- 2 year 4.16%, up 2.5 basis points
- 5 year 4.201%, up 2.0 basis point
- 10 year 4.417%, up 1.7 basis points
- 30 year 4863% up 0.7 basis points.
In other markets:
- Crude oil is down -$0.58 at $69.75.
- Gold is down -$9.60 and below $4000 at $3982
- SIlver is -$0.25 at $57.12
- Bitcoin is back above $60K at $61098.
The economic calendar is full of releases today. At 8:30 AM the PCE data (is it still the Fed’s favorite measure of inflation in the Warsh Era?) for May will continue its move higher one more time. The market expects headline PCE to rise 0.5% month-over-month and 4.1% year-over-year (vs 3.8% last month), while core PCE is forecast to increase 0.3% on the month and 3.4% annually (vs 3.3% last month). A reading in line with or above expectations would reinforce the Fed’s higher-for-longer stance, likely supporting the U.S. dollar and Treasury yields while weighing on stocks and precious metals. A softer-than-expected report would ease inflation concerns and could spark a pullback in yields and the dollar, but one cooler report is unlikely to significantly alter the Fed’s focus on restoring price stability. The good news is that oil prices have come down sharply which may ease the levels next month. Is it enough?
Personal income and personal consumption are expected at 0.4% for income vs 0.0% last month and 0.6% for consumption vs 0.5% last month.
Durable goods orders will also be released wtih expectations for preliminary reading to show -4.5% after an oversized 8.0% last month. Ex transport is projected at 0.6% vs 1.1% last month. NonDefense Cap ex Air is expected at 0.6% vs -1.0% last month.
Weekly initial jobless claims are expected at 225K versus 226K last week. Continuing claims are expected at 1.800 million versus 1.810 million last week. GDP Q1 revision expected unchanged at 1.6%. Q4 came in at 0.5%. There is some Fed speak today with New York Fed Pres. Williams and Chicago Fed Pres. Goolsbee expected to speak on the economy/policy. Goolsbee said over the weekend that inflation remains above target and is going the wrong way.
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