China April retail sales and fixed asset consumption rose but missed expectations. The PBOC lowered minimum down payments for homes and removed mortgage interest minimums. They made available 300B yuan ($41.5B) in cheap funding so state-owned entities can buy unsold supplies of homes. Asian markets except for China were lower. The Nikkei 225 pulled back -0.34%% while the Shanghai Composite jumped +1.01% (highest since Oct. 12). European markets were in retreat. The DAX Index lost -0.18%. 10-year bunds yield 2.519%. For 05/11 Baker Hughes reported that the U.S. rig count fell by 1 to 718. April Leading Indicators Index dropped by -0.6% vs. -0.3 expected (see Looking Ahead), and E-Commerce Retail Sales gained +2.1% QoQ from +0.8% prior. 10-Year Notes yield 4.422%. The June US$ Index was near unchanged at 104.355. June Crude Oil added +1.1% to $80.06 June Gold jumped by +1.4% to close at a record high $2,417.40. Bitcoin gained +2.6% in the last 24 hours, to $66,980. July Copper surged to record high $5.05/lb, with July silver at an 11-yr high of $31.26, and the CRB commodities index up +18% YTD. Today we heard from the Fed’s Waller, Kashkari and Daly, and later it was reported that Fed Chief Powell tested Covid positive. The ES traded both sides of even, but closed marginally higher.

Japan’s Q1 GDP contracted more than expected, but traders were cheered by a less than feared rise in U.S. inflation. Asian markets were higher. The Nikkei 225 jumped +1.39% and the Shanghai Composite rose +0.08%. European markets were mixed. The DAX Index lost -0.69%. 10-year bunds yield 2.464%. For 05/11 Initial Claims eased to 222K. April Housing Starts remained anemic at 1.360M vs. 1.435M consensus, Building Permits slipped slightly from 1.485M to 1.440M, Import Prices soared +0.9% vs. _0.2% expected, Export Prices rose +0.5% vs. +0.2% expected, Industrial Production came in unchanged, Manufacturing Output printed at -0.3% vs. +0.3% expected, and Capacity Utilization ticked down to 78.4%. The May Philadelphia Fed Manufacturing Index fell back to 4.5 from 15.5 prior, and missing expectations of a 7.8 print. 10-Year Notes yield 4.384%. The June US$ Index was up +0.19% to 104.415. June Crude Oil added +0.8% to 79.23. June Gold faded -0.5% to $2,383.80. In the last 24 hours Bitcoin dipped -1.3% to a price of $65,232. Walmart beat earnings expectations and gained +7.0%. The Fed’s Barr, Barkin, Harker, Mester and Bostic spoke, offering no fresh insights. Major indexes hit intraday all-time highs but at midday they reversed and closed modestly lower.

Australia’s annual budget set goals of “keeping pressure off inflation” among other goals. Asian markets were mostly higher. The Nikkei 225 crept up +0.08% while the Shanghai Composite fell -0.82%. European markets were green. The DAX Index gained +0.82%. 10-year bunds yield 2.425%. For 05/11 the MBA Mortgage Applications Index ticked up +0.5% from a prior +2.6% gain, and EIA Crude Inventories fell by -2.5M bbls vs. -1.4M bbls prior. March Business Inventories printed a MoM decline of -0.1% vs. 0.0% consensus. The April Consumer Price Index was up +0.3% (ex-food and energy +0.3%) as exp., with the YoY CPI printing at +3.4%, and inline with estimates, but still a long way from the Fed’s 2% target. April Retail Sales were flat (ex-vehicles +0.2%) vs. +0.4% est. The May Empire State Mfg. Index fell to -15.6 vs. -10.0 est., and the NAHB Home Builders Index fell to 45 (51 prior), below consensus of 51. 10-Year Note yields fell to a 1-mo low of 4.359%. The June US$ Index sank -0.66% to 104.195. June Crude Oil scored a +0.8% gain to 78.63. June Gold posted a strong gain of +1.4% to $2,392.60. Fed officials Barr, Kashkari and Bowman gave separate talks today, with Kashkari saying rates should stay on hold “a while longer.” Stocks cheered the .10% CPI “miss” and rallied strong.