• APAC stocks were mostly lower as the region tracked the losses on Wall St where risk sentiment was subdued after mixed earnings releases and disappointing US data.
• European equity futures are indicative of a contained open with Euro Stoxx 50 future +0.1% after the cash market closed lower by 0.2% yesterday.
• DXY was steady below the 102 mark, JPY leads the way for G10 FX, AUD lags, other majors are contained.
• Crude futures remained despondent with prices stuck near their post-OPEC cut lows.
• Highlights include UK Retail Sales, EZ, UK & US Flash PMIs, Speeches from Fed's Cook & Harker, ECB's Elderson & de Guindos, Supply from Italy, Earnings from Kering & SAP.

US TRADE

EQUITIES

• US stocks finished lower with price action choppy throughout the session amid mixed earnings reports, mostly disappointing data releases and continued hawkish rhetoric from the Fed ahead of the blackout period.
• SPX -0.59% at 4,129, NDX -0.78% at 12,985, DJIA -0.33% at 33,786, RUT -0.54% at 1,789.
• Click here for a detailed summary.

NOTABLE HEADLINES

• Fed Discount Window borrowing rose to USD 69.9bln on April 19th (prev. 67.6bln W/W) which was the first increase since mid-March, while BTFP lending increased to USD 74bln (prev. 71.8bln W/W) and other credit lending was at USD 172.6bln (prev. 172.6bln W/W).
• Fed's Bowman (voter) said the Fed is focused on lowering inflation and commented that a strong labour market has made finding workers extremely difficult. Bowman added they clearly need to continue to work to bring inflation down and that bankers see an economic slowdown as likely within the next year so are seeing fewer opportunities to lend.
• Fed's Harker (voter) said some additional tightening is needed to deal with high inflation and once rate hikes end, the Fed will need to hold steady for a while. Harker also commented that they need to be cautious when moving during a period of uncertainty and that the Fed is close to where it needs to be on rates.
• Fed's Logan (voter) said inflation has been much too high and they are to assess if they have made enough progress, while they are watching for a further, sustained improvement in inflation.
• Fed's Waller (voter) said with SVB, there was no way to process collateral for Discount Window lending fast enough and need to think about how to assess and process collateral faster, while he added that things have kind of calmed down in the banking sector.
• Fed's Bostic (non-voter) said inflation is too high and the Fed must reduce it to 2%, while he favours one more rate hike, then a pause. Furthermore, Bostic said policy has moved into restrictive space and works with a lag, as well as noted that tighter credit is beginning to do the Fed's work for it.
• Fed's Mester (non-voter) reiterated the Fed will need to hike the policy rate to over 5% and hold there for a while. Mester also commented that inflation is still too high and the Fed has more work to do but added that they are much closer to the end of the rate-hike journey. Mester also said that growth will be slow this year and reiterated that how much higher than 5% rates would need to go and how long they stay there will depend on the economy, while she said that getting inflation down is her focus and they will evaluate the peak funds rate at the FOMC meeting.
• US House Speaker McCarthy said the GOP is in "very good shape" on the debt limit bill, while the White House said House Speaker McCarthy's debt plan would hurt manufacturing jobs.
• US President Biden and his team are preparing to announce his re-election campaign next week, according to Washington Post. Reuters also reported that President Biden plans to launch his re-election campaign with a video as soon as Tuesday, according to sources.

APAC TRADE

EQUITIES

• APAC stocks were mostly lower as the region tracked the losses on Wall St where risk sentiment was subdued after mixed earnings releases and disappointing US data.
• ASX 200 was pressured by weakness in financials and underperformance in the mining sector as Australia’s largest company BHP suffered after a decline in quarterly iron ore output.
• Nikkei 225 traded indecisively following mixed PMIs and the latest inflation data which printed mostly in line with estimates but remained above 3% and showed an acceleration in nationwide Ex. Fresh Food & Energy CPI.
• Hang Seng and Shanghai Comp underperformed amid ongoing US-China frictions with President Biden to unveil China investment curbs, while there was also fierce rhetoric from China's Foreign Minister who said both sides of the Taiwan Strait belong to China and warned that those who play with fire on Taiwan will get burned.
• US equity futures traded rangebound after the prior day's losses and amid cautiousness in Asia.
• European equity futures are indicative of a contained open with Euro Stoxx 50 future +0.1% after the cash market closed lower by 0.2% yesterday.

FX

• DXY was steady overnight beneath the 102.00 level after the prior day’s losses and disappointing data releases although further downside was cushioned by the slew of hawkish-leaning Fed rhetoric.
• EUR/USD lacked firm direction with the single currency contained within a tight range on the 1.0900 handle.
• GBP/USD was little changed ahead of incoming UK Retail Sales and PMI data, with the pair largely unmoved despite comments from BoE's Tenreyro that they may have already tightened too much.
• USD/JPY extended its retreat in tandem with softer US yields and in the aftermath of the Japanese inflation data.
• Antipodeans were pressured owing to the uninspired risk tone and recent decline in commodity prices.
• PBoC set USD/CNY mid-point at 6.8752 vs exp. 6.8758 (prev. 6.8987)

FIXED INCOME

• 10yr UST futures marginally extended on gains after the recent bull steepening owing to soft US data releases and despite the hawkish commentary from Fed speakers who were out in force ahead of the blackout period.
• Bund futures hovered around the prior day’s highs above 134.00 with help from data-induced tailwinds
• 10yr JGB futures took impetus from the gains in global peers and with the BoJ in the market for JPY 1.85tln of JGBs on top of its daily fixed-rate operations.

COMMODITIES

• Crude futures remained despondent with prices stuck near their post-OPEC cut lows after recent selling pressure due to lingering recessionary fears and following the weaker-than-expected data releases stateside.
• White House said the EPA is processing a request from Florida to expand the available gas supply.
• Turkish President Erdogan said the government will provide free natural gas for household consumption up to 25 cubic meters monthly.
• Spot gold traded sideways amid a flat greenback and just about held on to the USD 2,000/oz level.
• Copper futures languished around the prior day's lows owing to the subdued global risk environment.
• Chile's Codelco Chairman said extraordinarily powerful copper fundamentals favour project investment and sees a return to a total annual output of 1.7mln tons, or a 17% increase by the end of the decade.

CRYPTO

• Bitcoin traded rangebound alongside the cautious mood across risk assets.

NOTABLE ASIA-PAC HEADLINES

• US President Biden is to unveil China investment curbs prior to the G7 summit in May, according to Bloomberg.
• White House said President Biden and French President Macron discussed in a phone call Macron's trip to China and they reaffirmed the importance of maintaining peace and stability across the Taiwan Strait.
• China's FX regulator said the valuation of Chinese A shares is low and investment prospects are good, while the regulator added that US-China yield differentials are shrinking and the external impact on China is decreasing.

DATA RECAP

• Japanese National CPI YY (Mar) 3.2% vs. Exp. 3.2% (Prev. 3.3%)
• Japanese National CPI Ex. Fresh Food YY (Mar) 3.1% vs. Exp. 3.1% (Prev. 3.1%)
• Japanese National CPI Ex. Fresh Food & Energy YY (Mar) 3.8% vs. Exp. 3.4% (Prev. 3.5%)
• Japanese Manufacturing PMI (Apr P) 49.5 (Prev. 49.2)
• Japanese Services PMI (Apr P) 54.9 (Prev. 55.0)
• Japanese Composite (Apr P) 52.5 (Prev. 52.9)
• Australian Manufacturing PMI (Apr P) 48.1 (Prev. 49.1)
• Australian Services PMI (Apr P) 52.6 (Prev. 48.6)
• Australian Composite PMI (Apr P) 52.2 (Prev. 48.5)

GEOPOLITICAL

• Chinese Foreign Minister Qin Gang said there has recently been absurd rhetoric accusing China of upending the status quo, as well as disrupting peace and stability across the Taiwan Strait, while Qin added that the logic is absurd and the conclusion dangerous. Qin also commented that both sides of the Strait belong to China and that those who play with fire on Taiwan will eventually get themselves burned, according to Reuters.
• G7 countries are considering a near-total ban of exports to Russia, according to Kyodo citing sources.
• Russian Foreign Minister Lavrov said almost nothing has been done to address Moscow's concerns when asked about the future of the Black Sea grain deal.
• An opinion piece in the Telegraph by Isle of Wight MP Bob Seely claimed that Russian President Putin is preparing to attack the UK and said the deployment of Russian spy ships is chilling, while he added that Britain is far from ready to counter whatever Putin has planned.
• Eurocontrol was reportedly under a cyberattack from pro-Russia hackers who targeted websites, while internal and external communications were affected although air traffic was unaffected, according to WSJ.
• North Korea said it will continue necessary action until military threats from the US are eliminated and its status of nuclear weapons state will remain an undeniable fact, while it warned it will take strong action if G7 countries attempt to violate its sovereignty and fundamental interests, according to KCNA.

EU/UK

• BoE's Tenreyro said the UK inflation target is flexible and intended to respond to shocks, while she added that they may have already tightened a bit too much.
• ECB's Schnabel reiterated that headline inflation has started to decline but noted core inflation proves sticky, while she added that energy contributions to inflation are falling quickly although many other components to inflation are still on the rise.

DATA RECAP

• UK GfK Consumer Confidence (Apr) -30 vs. Exp. -35 (Prev. -36)