OVERNIGHT MARKETS AND NEWS

Jun E-mini S&Ps (ESM17 +0.17%) this morning are up +0.17% and European stocks are up +0.19% at a 20-month high on positive carry-over from Sunday’s presidential elections in France. The results of the election have reduced market uncertainty as pro-EU candidate Macron holds a substantial lead in the polls ahead of France’s May 7 runoff election against anti-EU candidate Le Pen for the French presidency. The easing of political risks in Europe has fueled a slide in the VIX volatility index to a 2-1/2 month low, which is supporting gains in equities. The markets will digest quarterly earnings results today from some 45 companies in the S&P 500. Asian stocks settled higher: Japan +1.08%, Hong Kong +1.31%, China +0.16%, Taiwan +1.27%, Australia closed for holiday, Singapore +0.63%, South Korea +1.22%, India +0.97%. Japan’s Nikkei Stock Index rallied to a 3-week high on signs that the BOJ, which meets tomorrow and Thursday, will continue its QE program after BOJ Deputy Governor Iwata said the BOJ will continue with policies to reach its 2% CPI target and that it is too early to talk about exit from its monetary easing program.

The dollar index (DXY00 -0.04%) is down -0.05%. EUR/USD (^EURUSD) is up +0.11%. USD/JPY (^USDJPY) is up +0.60%.

Jun 10-year T-note prices (ZNM17 -0.19%) are down -7.5 ticks as a sell-off in 10-year German bund prices to a 3-1/2 week low undercuts T-notes.

U.S. STOCK PREVIEW

Key U.S. news today includes: (1) Feb FHFA house price index (expected +0.4% m/m, Jan unch m/m), (2) Feb S&P CoreLogic composite-20 home price index (expected +0.77% m/m and +5.78% y/y, Jan +0.86% m/m and +5.73% y/y), (3) Mar new home sales (expected -1.5% to 583,000, Feb +6.1% to 592,000), (4) Apr Conference Board U.S. consumer confidence index (expected -3.1 to 122.5, Mar +9.5 to 125.6), (5) Apr Richmond Fed manufacturing index (expected -6 to 16, Mar +5 to 22), (6) Treasury auctions $26 billion of 2-year T-notes.

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