Morning Juice – US Session Prep (11th May)

Sentiment
Stocks remained resilient despite higher oil prices and rising bond yields after the US and Iran failed to reach an agreement to end the Middle East war. S&P 500 futures stayed just below all-time highs, even as Brent rose more than 2% to above $103 a barrel with the Strait of Hormuz still closed. Hopes of reopening the waterway faded after Trump called Iran’s latest proposals “totally unacceptable.”

Bond yields moved higher globally as the standoff revived fears of an oil-driven inflation shock and reinforced expectations that central banks may need to stay tighter for longer. The 10-year Treasury yield rose 3bps to 4.39%, the dollar edged up 0.1%, and gold fell below $4,700 an ounce. In the UK, gilts underperformed as political pressure on Starmer intensified following Labour’s heavy local election losses.

Since the Middle East crisis began in late February, markets have not only fully priced out Fed cuts, but have also started to consider the possibility that Warsh, Trump’s choice to replace Powell, may need to raise rates next year.

Docket
13:00 ET
US sells $58 bln 3-Year Notes
Prior High Yield: 3.897%
Prior Bid-to-cover: 2.68

Speakers
10:30 ET
Trump participates in a Maternal Healthcare Event.

16:00 ET
Trump hosts National Footbacll Champions

Good luck!