• APAC stocks were mixed following the indecisive performance stateside, while somewhat mixed but improved Chinese trade data had little impact.
• European equity futures indicate a flat open with Euro Stoxx 50 futures unchanged after the cash market closed higher by 0.4% on Wednesday.
• DXY is steady near the 105.50 mark with price action in the FX space contained.
• Bunds extended on their recent pullback, Crude remains afloat after yesterday's rebound.
• Looking ahead, highlights include US IJC, BoE Policy Announcement, BoE DMP, Banxico Policy Announcement, Fed's Daily, BoE’s Bailey & Pill, ECB’s Cipollone & de Guindos, Supply from Spain & US. Note, closures across Scandinavia and Switzerland for Ascension Day. 

US TRADE

EQUITIES

• US stocks were ultimately mixed with the SPX and NDX little changed but the Dow was bid and RTY was hit as equity markets continued to meander in search of the next catalyst, while mixed earnings and geopolitical uncertainty added to the tentative mood.
• SPX +0.00% at 5,187, NDX -0.04% at 18,085, DJIA +0.44% at 39,056, RUT -0.46% at 2,055.
• Click here for a detailed summary.

NOTABLE HEADLINES

• Fed's Cook (voter) said in a review of financial stability that households remain resilient but she is watching climbing delinquency rates, while she added that firms have ample earnings to cover debt payments and financial firms are well positioned to absorb shocks.
• Fed's Collins (non-voter) said she expects demand will need to slow to get inflation to 2% and Fed policy is well positioned for the current outlook, while she added it is "moderately restrictive" and there are risks to cutting rates too soon. Collins said current monetary policy should slow the economy and it is too soon to tell just how restrictive policy is.
• NY Fed's Perli said the balance sheet wind-down process has been smooth and slowing the pace of the wind-down reduces the risk of market stress. Perli said the Fed has tools to deal with unexpected money market stress and all signs point to still abundant market liquidity levels but also noted there is a lot of uncertainty around the final decision for the Fed balance sheet.
• US GOP Rep. Greene pushed for a vote to remove House Speaker Johnson which prompted House Majority Leader Scalise to introduce a motion to shelve the effort to oust Speaker Johnson, while the House then voted 359 to 43 to prevent Johnson's removal.

APAC TRADE

EQUITIES

• APAC stocks were mixed as the region took its cue from the indecisive performance stateside owing to mixed earnings and as markets await the next major catalysts, while the somewhat mixed but improved Chinese trade data had little impact.
• ASX 200 was dragged lower by underperformance in consumer stocks and financials with the latter pressured after Australia's largest lender CBA reported a decline in profits.
• Nikkei 225 recovered from an early dip with trade contained as participants digested BoJ rhetoric and soft wages.
• Hang Seng & Shanghai Comp were underpinned amid resilience in the tech sector and after China's eastern city of Hangzhou lifted all home purchase restrictions, although there were headwinds from default concerns as Country Garden Holdings (2007 HK) failed to make coupon payments on a yuan-denominated bond due today but still has a grace period.
• US equity futures remained lacklustre after the prior day's choppy performance.
• European equity futures indicate a flat open with Euro Stoxx 50 futures unchanged after the cash market closed higher by 0.4% on Wednesday.

FX

• DXY traded rangebound around 105.50 with price action muted as catalysts from the US remained light so far this week, while there were neutral comments from Fed's Collins who noted policy is well positioned and that there are risks to cutting too soon.
• EUR/USD lacked direction after a recent choppy performance and with ECB rhetoric providing little surprise.
• GBP/USD price action is stuck within a thin range near the 1.2500 level heading into today's BoE policy decision.
• USD/JPY briefly retreated after the BoJ SOO suggested an openness to future hikes, although the move was quickly reversed.
• Antipodeans conformed to the humdrum mood across the FX space with a muted reaction to China's trade data.
• PBoC set USD/CNY mid-point at 7.1028 vs exp. 7.2238 (prev. 7.1016).
• Brazil Central Bank cut the Selic rate by 25bps to 10.50%, as expected, whereby 5 members voted in favour of a 25bps cut and 4 members voted for a 50bps reduction. The committee unanimously judged that the uncertain global scenario and the domestic scenario, marked by resilient economic activity and de-anchored expectations, require greater caution. It also stated that monetary policy should continue being contractionary until the consolidation of both the disinflation process and the anchoring of expectations around the targets.

FIXED INCOME

• 10-year UST futures prodded this week's lows after recent selling pressure and an average US 10-year auction.
• Bund futures extended on its recent pullback amid the absence of any fresh major catalysts from the eurozone.
• 10-year JGB futures retreated with pressure seen following the BoJ Summary of Opinions which noted a willingness for further adjustments if trend inflation accelerates but reiterated an accommodative financial environment is likely to continue for the time being.

COMMODITIES

• Crude futures remained afloat after yesterday's rebound which was helped by inventory data.
• Spot gold eked marginal gains as price action settled down following the recent whipsawing.
• Copper futures were positive but with upside limited amid the overall mixed risk appetite.
• Mexico is said to be mulling options to absorb some USD 40bln in Pemex debt, according to Bloomberg citing the Deputy Finance Minister. The plan would be gradual over six years and any significant operations would require a change in legislation.

CRYPTO

• Bitcoin gradually trended higher throughout the session to north of USD 61,700.

NOTABLE ASIA-PAC HEADLINES

• PBoC said it could either buy or sell treasury bonds in the secondary market depending on market conditions, as such trades can be used to manage liquidity, according to Reuters.
• China's eastern city of Hangzhou lifted all home purchase restrictions, according to its housing authority.
• Country Garden Holdings (2007 HK) said it cannot make payments on a yuan-denominated bond, while it aims to pay onshore coupons due today and additional interests by May 13th. Furthermore, it stated that if it fails to make payments within the grace period, China Bond Insurance Co. will undertake credit enhancement obligations and it is still raising funds due to sales recovery lagging expectations.
• US Commerce Secretary Raimondo said the US could ban Chinese-connected vehicles or impose guardrails, while it was separately reported that US Senator Brown is seeking a US ban on all Chinese internet-connected vehicles, according to Bloomberg.
• Hong Kong and Saudi Arabia are exploring an ETF to track Hong Kong stock indices, while Hong Kong is working with several financial institutions to develop the ETF and the government is considering establishing an economic and trade office in Riyadh.
• BoJ Summary of Opinions from the April meeting noted that a member stated if trend inflation accelerates, the BoJ will adjust the degree of monetary easing but an accommodative financial environment is likely to continue for the time being and a member said if forecasts under quarterly report are met, interest rates might rise to levels higher than markets currently price in. It was also stated that one option would be to hike rates moderately in accordance with economic, price and financial developments to avoid a shock from an abrupt policy shift. Furthermore, a member said they must hike rates at an appropriate time as the likelihood of achieving forecasts heightens and a member said the BoJ must deepen the debate on the timing and pace of a future rate hike.
• BoJ Governor Ueda said a low real rate supports the economy and inflation, while he added that they need to monitor FX and oil for real wages. Ueda also stated the BoJ could adjust the degree of monetary accommodation via rate hikes if trend inflation accelerates gradually, as well as noted that a sharp, one-sided yen fall is undesirable and bad for the economy. Furthermore, he reiterated if FX volatility affects or risks affecting trend inflation, the BoJ must respond with monetary policy and will scrutinise the recent weak yen in guiding monetary policy.
• Japanese Finance Minister Suzuki said it is important for currencies to move in a stable manner reflecting fundamentals and rapid FX moves are undesirable, while they are closely watching FX moves and will take thorough response in forex. Suzuki also stated they will take all necessary measures and continue to analyse the FX impact on the economy and livelihoods and take appropriate action.
• Japanese top currency diplomat Kanda said no comment on intervention and if necessary, they will take appropriate action and are ready for currency intervention at any time, while he added that comments about Japan's limitations are wrong when asked about FX intervention reserves.

DATA RECAP

• Chinese Trade Balance (USD)(Apr) 72.35B vs. Exp. 77.5B (Prev. 58.55B)
• Chinese Exports YY (USD)(Apr) 1.5% vs. Exp. 1.5% (Prev. -7.5%)
• Chinese Imports YY (USD)(Apr) 8.4% vs. Exp. 4.8% (Prev. -1.9%)
• Chinese Trade Balance (CNY)(Apr) 513.5B (Prev. 415.9B)
• Chinese Exports YY (CNY)(Apr) 5.1% (Prev. -3.8%)
• Chinese Imports YY (CNY)(Apr) 12.2% (Prev. 2.0%)
• Japanese Overall Labour Cash Earnings YY (Mar) 0.6% vs. Exp. 1.5% (Prev. 1.8%)

GEOPOLITICS

MIDDLE EAST

• US President Biden said if Israel goes into Rafah, he won't supply them with weapons and artillery shells, while he added that Israel will not get their support if they go into those population centres and that bombs the US had supplied to Israel and now paused have been used to kill civilians. Biden also commented that Israel has not gone over the red line yet, while he is working with Arab states that are prepared to build Gaza and prepared to help transition to a two-state solution.
• Hamas senior official said the movement sticks to its approval of the truce proposal.
• Egyptian media said Israel deleted the phrase 'permanent ceasefire' and kept it 'sustainable', while Hamas, Islamic Jihad and Popular Front are participating in negotiations and are open to maturing and succeeding the Egyptian effort to reach a deal. Furthermore, work is underway to overcome the controversial points during the negotiations, which will be completed on Thursday, according to Asharq News.
• Israeli army said it "killed the commander of the Hamas naval force in a bombing of Gaza City yesterday", according to Asharq News.
• Israeli senior officials warned their US counterparts that the Biden administration's decision to pause a weapons shipment to Israel could jeopardise hostage negotiations, according to two sources briefed on the issue told Axios' Ravid.
• Syria shot down Israeli missiles fired from Golan Heights towards Damascus's surroundings.
• Adviser to Iran's Supreme Leader said Tehran will have to change its nuclear doctrine if its existence is threatened and has the capability to build a nuclear weapon, according to SNN.

OTHER

• Ukraine drone attack sparked a fire and damaged oil tanks at a refinery in Russia's Krasnodar, according to regional officials.

EU/UK

DATA RECAP

• UK RICS Housing Survey (Apr) -5.0 vs. Exp. -2.0 (Prev. -4.0, Rev. -5.0)