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Market Roundup: Rates & Stocks Pull Higher Ahead Holiday Wknd

Tsys trade firmer by midmorning, near session highs (30YY at 2.9499% vs. 2.9388% low), curves flatter with the long end outperforming (2s10s -2.051 at 24.456; 5s30s -1.710 at 1.741). Equities stronger, ESM2 climbed over 4100 to 4126.0 high (+71.0)
  • Rates extended session highs ahead the NY open, no obvious headline or flow driver w/ some desks citing drop in oil prices, others: ongoing geopol risk metrics: Russia/Ukraine headlines never far from the front burner, latest rhetoric from FM Lavrov: West has declared ‘total war’ on Russia (Al Arabiya); European Union Is Working n Russia Oil Sanctions Deal That Would Exclude Pipeline Deliveries (Benzinga).
  • Bonds receded off early session highs post data, Apr core PCE at 4.9% YoY but headline of 6.3% YoY slightly higher than expected and fastest of last three months.
  • Otherwise, generally quiet ahead the extended Memorial Day wknd, national holiday Mon, cash FI markets closed while Globex opens at normal time Sunday evening at 1800ET through Monday at 1300ET. Globex reopens at 1800ET Monday evening.
  • Reminder: Sep futures take lead quarterly next Tuesday.
  • US 10Y technicals w/ TYU2 trading 120-15 (+8): contract testing above the 50-day EMA. A clear break of this average would pave the way for a climb towards the 122-00 handle. Gains are still considered corrective though and the primary trend direction remains down. Key support and the bear trigger is 116-21, May 9 low. Initial firm support has been defined at 118-01+, the May 18 low.

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