• Wall Street equities ended higher on May 14, with the DJI rose by +0.32%, the S&P 500 grew by +0.48%, and the Nasdaq closed up by +0.75%.
• US stocks closed higher Tuesday, with the S&P 500 hitting a 5-week high and the Nasdaq 100 a 1-month high. Gains were driven by falling bond yields after dovish comments from Fed Chair Powell, but limited by higher-than-expected April core producer prices. Markets now await the release of April core CPI later today, expected to ease to +3.6% YoY from +3.8% YoY in March.
• The 10-yr UST yields fell by -3.0 bps to 4.45%, while 2-yr yields slipped by -4.0 bps to 4.81%. Treasuries found support on Tuesday’s as Fed Chair Powell hinted at no immediate rate hike, countering initial pressure from higher-than-expected US core April PPI, signaling a more hawkish Fed stance.
• The April Producer Price Index (PPI) in the US climbed by +2.2% YoY, picking up from a downwardly revised 1.8% rise in March, aligning expectations. However, the core PPI excluding food and energy increased by +2.4% YoY, slightly exceeding the anticipated +2.3% YoY.
• Meanwhile, President Biden unveiled plans on Tuesday to impose tariffs on USD18bn worth of Chinese imports, spanning electric vehicles, steel, aluminum, semiconductors, medical devices, and other goods.
• In Asia, credit in China shrank in April as government bond sales slowed and loan expansion weakened. Aggregate financing decreased by nearly USD27.7bn from the previous month.
• Global bond yields were mixed on Tuesday, the German bund yield rose by +3.8 bps to 2.54%, while the 10-yr UK gilts yield edged down by -0.1 bps to 4.17%. The Japanese 10-yr JGB yield closed up by +1.6 bps 0.95%.
