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Futures Weaker Overnight With US Tsys, National CPI Broadly In Line

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In post-Tokyo trade, JGB futures are sharply lower, closing -16 compared to settlement levels, after US tsys extended recent losses on Thursday. Stronger-than-expected PMIs and another tight claims report further pushed back Fed easing expectations.

  • Services PMI (54.8 vs. 51.2 est) and Composite PMI (54.4 vs. 51.2 est) while Manufacturing PMI was slightly higher (50.9 vs. 49.9 est).
  • Weekly claims were lower than expected at 215k vs. 220k est, prior revised to 223k from 222k.
  • US tsy yields finished up 4-6bps across benchmarks. The 10-year rate was up 5bps at 4.48%.
  • US STIR is back to pricing just 35bps of cuts this year, with November no longer fully priced.
  • The flash data sapped the early risk-on tone with S&P Eminis and Nasdaq indexes marking new all-time highs before extending lows amid several rounds of program selling/profit-taking ahead of the extended Memorial holiday weekend. Nvidia rose 9.3%, lifting its market cap to $US2.55 trillion.
  • Japan’s National CPI for April prints slightly higher than expected at +2.5% y/y (+2.4% est). However, Core and Core-Core print in line at 2.2% y/y and 2.4% y/y.
  • Today, the local calendar also see Department Sales data later alongside a Liquidity Enhancement Auction for OTR 5-15.5-year JGBs.
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In post-Tokyo trade, JGB futures are sharply lower, closing -16 compared to settlement levels, after US tsys extended recent losses on Thursday. Stronger-than-expected PMIs and another tight claims report further pushed back Fed easing expectations.

  • Services PMI (54.8 vs. 51.2 est) and Composite PMI (54.4 vs. 51.2 est) while Manufacturing PMI was slightly higher (50.9 vs. 49.9 est).
  • Weekly claims were lower than expected at 215k vs. 220k est, prior revised to 223k from 222k.
  • US tsy yields finished up 4-6bps across benchmarks. The 10-year rate was up 5bps at 4.48%.
  • US STIR is back to pricing just 35bps of cuts this year, with November no longer fully priced.
  • The flash data sapped the early risk-on tone with S&P Eminis and Nasdaq indexes marking new all-time highs before extending lows amid several rounds of program selling/profit-taking ahead of the extended Memorial holiday weekend. Nvidia rose 9.3%, lifting its market cap to $US2.55 trillion.
  • Japan’s National CPI for April prints slightly higher than expected at +2.5% y/y (+2.4% est). However, Core and Core-Core print in line at 2.2% y/y and 2.4% y/y.
  • Today, the local calendar also see Department Sales data later alongside a Liquidity Enhancement Auction for OTR 5-15.5-year JGBs.