US Stocks fell and Treasuries rose on the escalating trade tensions and political unrest in Hong Kong. Many analysts revised their forecasts of their fourth quarter growth lower and raised chance of an economic recession as the prospect of a trade deal has become dimmer. China’s central bank set its daily midpoint for yuan at 7.0211 per dollar, signaling its determination to manage an orderly depreciation. The overnight session turned sour and losses accelerated in early trading after authorities closed Hong Kong International Airport, canceling all departures for the remainder of the day. The fragile mood continued to reverberate through markets with gains in the safe haven showing traders have increased their bets for easier monetary policy. In corporate news, many companies that are scheduled to release their quarterly results this week include Alibaba, Cisco, Walmart, Nvidia, and Prudential. Elsewhere, WTI crude edged higher this morning, trading above $55 a barrel. Later today, Monthly Budget Statement in July will be released at 11:00 AM (PT), and the US Treasury is scheduled to auction off $42 billion of 3-month bills and $42 billion of 6-month bills at 8:30 AM (PT).
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US Stocks fell and Treasuries rose on the escalating trade tensions and political unrest in Hong Kong. Many analysts revised their forecasts of their fourth quarter growth lower and raised chance of an economic recession as the prospect of a trade deal has become dimmer. China’s central bank set its daily midpoint for yuan at 7.0211 per dollar, signaling its determination to manage an orderly depreciation. The overnight session turned sour and losses accelerated in early trading after authorities closed Hong Kong International Airport, canceling all departures for the remainder of the day. The fragile mood continued to reverberate through markets with gains in the safe haven showing traders have increased their bets for easier monetary policy. In corporate news, many companies that are scheduled to release their quarterly results this week include Alibaba, Cisco, Walmart, Nvidia, and Prudential. Elsewhere, WTI crude edged higher this morning, trading above $55 a barrel. Later today, Monthly Budget Statement in July will be released at 11:00 AM (PT), and the US Treasury is scheduled to auction off $42 billion of 3-month bills and $42 billion of 6-month bills at 8:30 AM (PT).
The curve has bull-flattened with UST 10-Year yield down 6.52 bps.