• Wall Street equities closed mixed on May 10, as the DJI surged by +0.32%, the S&P 500 rose by +0.16%, and the Nasdaq edged down by -0.03%.
• US stocks gained momentum on Friday, driven by chip stocks and upbeat Q1 earnings, expected to rise by +6.5% YoY, surpassing the pre-season estimate of +3.8%. However, higher T-note yields and a disappointing consumer sentiment report dampened the market, reflecting subdued sentiment and heightened inflation concerns.
• The 10-yr UST yields surged by +5.0 bps to 4.50%, while 2-yr yields jumped by +7.0 bps to 4.87%. T-note prices declined due to hawkish Fed remarks, rising US consumer inflation expectations, and reduced Fed rate cut expectations.
• The University of Michigan's preliminary May US consumer sentiment index dropped by -9.8 points to a six-month low of 67.4, falling below market expectations for a -1.0 point decline to 76.2.
• Meanwhile, The University of Michigan’s May US 1-year inflation expectation surged to +3.5% from April's 3.2%, surpassing expectations of remaining unchanged at 3.2%. Similarly, the May 5-10 year inflation expectation indicator rose to +3.1% from April's 3.0%.
• In Asia, China's consumer prices rose by +0.3% YoY in April 2024, surpassing both market estimates and March's figure, which saw a +0.1% increase. Conversely, producer prices declined by -2.5% YoY in April 2024, compared to market forecasts of a -2.3% fall and March's -2.8% decrease.
• Global bond yields were mixed on Friday, The German bund yield rose by +2.2 bps to 2.52%, while the 10-yr UK gilts yield increased by +2.4 bps to 4.16%. The Japanese 10-yr JGB yield closed down by -1.4 bps 0.86%.
