Wednesday, May 29
► European markets opened lower with the Stoxx 600 slipping 0.35%. German 10-year yields neared their highest levels since November ahead of the release of national inflation data, which is expected to increase to 2.5% from 2.2%. Traders are closely monitoring this data amidst the backdrop of resilient US consumer confidence and hawkish Federal Reserve remarks, which have heightened expectations for prolonged high interest rates. Additionally, Germany's consumer confidence showed improvement but remains pessimistic, rising to -20.90 in June from -24 in May, exceeding market expectations.
► US equity futures indicate a decline, mirroring the cautious sentiment seen in Europe. The market's unease follows weak demand in US Treasury sales and hawkish comments from Federal Reserve officials, suggesting interest rates may remain elevated. The 10-year Treasury yields increased to 4.57% after a nine basis point jump on Tuesday. Investors are particularly focused on the upcoming release of the Fed’s preferred inflation gauge, the personal consumption expenditures (PCE) index on Friday May 31, anticipated to show a 2.7% annual increase for April.
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