From Marc to Market:
Overview: The tone in the foreign exchange market today is mostly consolidative. The two notable exceptions are the yen and yuan. Despite higher JGBs yields amid speculation that the BOJ will scale back bond purchases, as it did yesterday, to support the yen, the greenback is at its best level since the suspected intervention. The next important technical area is near JPY157.00. The US is set to announce a new set of tariffs on a wide range of Chinese goods later today. Expectations that policy is about to be eased, coupled with the yen's weakness, appears to have helped push the yuan to new seven-day lows. Softer UK labor data weighed on sterling, but it recovered after the $1.25 area held. There are GBP1 bln of options that expire there today. Most emerging market currencies are firmer but a handful of Asia Pacific currencies and the South African rand.
Equities are mixed. Outside of China, Hong Kong, and Australia, most large bourses in the Asia Pacific region edged higher. The longest rally in Europe's Stoxx 600 since October-November 2021 is being challenged today. The benchmark is flat near midday, with a seven-day advance in tow. US index futures are little changed. The 10-year JGB yield rose. It held slightly below 1%, its highest level since last November. The soft labor market report is helping UK Gilts shine, with a nearly two basis point decline in the 10-year benchmark. That is the most in Europe today, where yields are mostly softer by less than a single basis point. The 10-year US Treasury yield a little lower near 4.73%. Gold is firmer near $2346 after falling 1% yesterday. June WTI is flattish near $79. It continues to consolidate, mostly between $75 and $80 so far in May....
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