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Breakfast Bites - Wed May 3, 2023

Rise and shine everyone

The big news today is the FOMC rate decision at 2pm ET, followed by the press conference at 2:30pm ET. Mayhem and I will be doing a brief Twitter spaces at 3:30pm to discuss the event. Please join in if you can, and bring your questions.

S&P futures up 0.1% in Wednesday morning trading after US equities came under pressure on Tuesday with the major indexes all down more than 1%. Regional bank stocks sold off sharply, while other cyclical pockets of the market lagged as well. Dollar index down 0.4% on broad-based weakness. Gold up 0.1%. Bitcoin futures little changed. WTI crude down 1.9% after losing nearly 5.5% on Tuesday.

Asia and Australia

  • Asian markets weaker overnight with Hong Kong down more than 1% and Australia and South Korea off nearly 1%, while China and Japan were closed for holidays.

  • China domestic tourism surges through first half of Golden Week

  • Mixed sell-side takeaways from Tuesday's 25 bp RBA rate increase, though most economists anticipate one more rate hike. Forward

  • Indian budget carrier Go First files for bankruptcy protection

  • U.S. to weigh rules for keeping AI safe from China, other competitors

Europe, Middle East, Africa

  • European markets seeing solid gains after deep losses on Tuesday.

  • Bonds finding support in Europe with benchmark yields in Eurozone and UK weaker after sharp drop late Tuesday amid renewed worries over US banking sector.

  • ECB rate hike on Thursday: Default option of 25bp likely to prevail as data fail to meet standard for 50bp hike

  • March Eurozone unemployment rate fell slightly to 6.5% vs consensus of 6.6% and prior month outcome of 6.6%.

The Americas

  • White House open to framing debt ceiling deal in a way that could allow both parties to claim victory. House Democrats prepping a "discharge petition" to help bring bipartisan debt-ceiling legislation directly to the floor

  • AMD guides Q2 below the Street but highlights expectations for 2H growth as PC and server markets improve

  • Starbucks earnings beat as China comps turn positive, notes NA comp trends normalizing

  • Ford posts better Q1 earnings, says it has a ways to go before making money on EVs


(news taken from Reuters, FT, Bloomberg; Calendar from Trading Economics)


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