US stocks were choppy and finished little changed in a catalyst-light session - Newsquawk Asia-Pac Market Open

• US stocks were rangebound with price action choppy as indices held on to their recent gains but with mixed performances under the surface, while there were no major macro catalysts although a softer Manheim used car vehicle index was the data "highlight" and the US 3yr Treasury auction saw solid demand ahead of the 10yr and 30yr offerings on Wednesday and Thursday, respectively.
• USD traded firmer albeit with price action kept to within a relatively thin range amid the lack of headline macro newsflow and tier 1 US data releases, while participants await several Fed speakers on Wednesday.
• Looking ahead, highlights include Philippines Industrial Production & Trade Balance, Supply from Australia & Japan.

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LOOKING AHEAD

• Highlights include Philippines Industrial Production & Trade Balance, Supply from Australia & Japan.
• Click here for the Newsquawk Week Ahead.

US TRADE

• US stocks were rangebound with price action choppy as indices held on to their recent gains but with mixed performances under the surface, while there were no major macro catalysts although a softer Manheim used car vehicle index was the data "highlight" and the US 3yr Treasury auction saw solid demand ahead of the 10yr and 30yr offerings on Wednesday and Thursday, respectively.
• SPX +0.13% at 5,187, NDX -0.01% at 18,091, DJIA +0.08% at 38,884, RUT +0.19% at 2,064.
• Click here for a detailed summary.

NOTABLE HEADLINES

• Fed's Kashkari (non-voter) said it is possible housing market resilience means the neutral rate has been pushed higher, at least in the short term and yield curve inversion does suggest policy is tight. Furthermore, he said that he modestly raised his neutral rate estimate to 2.5% from 2.0%.
• Apple (AAPL) announced a new iPad Air including the first larger version in which the new iPad Air is 50% faster and has an M2 chip, while the 13-inch iPad Air price starts at USD 799 and goes on sale next week. Apple also announced iPad Pro models with OLED display and M4 processors with a starting price of USD 999 and it unveiled a new Apple Pencil Pro.

DATA RECAP

• Manheim Used Vehicle Value Index (Apr) -14.0% Y/Y (prev. -14.7%)

FX

• USD traded firmer albeit with price action kept to within a relatively thin range amid the lack of headline macro newsflow and tier 1 US data releases, while participants await several Fed speakers on Wednesday.
• EUR mildly softened against the dollar and languished around the 1.0750 level after mixed data.
• GBP retreated to test 1.2500 to the downside but was able to defend the psychological level.
• JPY underperformed against G10 peers which saw USD/JPY gain a firmer footing at the 154.00 handle.

FIXED INCOME

• Treasuries bull-flattened ahead of expectedly strong Treasury auctions.

COMMODITIES

• Oil prices were lacklustre and hit their lowest levels since mid-March with the market becoming desensitised to Rafah headlines while Russia touted potential production increases.
• US DoE announced solicitation for up to 3.3mln bbls of oil for SPR replenishment.
• Russian Deputy PM Novak said the possibility of raising production under the OPEC+ deal is being analysed and there is no need to predict further OPEC+ steps but they need to look at the market and he agreed that oil output could be tweaked if needed, according to Interfax. However, Russia's Novak later stated that there are no discussions about an oil output increase at OPEC+.

GEOPOLITICAL

MIDDLE EAST

• Israeli PM Netanyahu's spokesman said Hamas's proposal is far from Israel's demands and the gaps are large. The spokesman added Hamas rejected all previous proposals and does not want an agreement, while Israel will not back down from implementing all the goals of the war, according to Al-Arabiya.
• Mid-level Israeli delegation travelled to Cairo to assess whether Hamas can be moved on the latest ceasefire terms, while a senior Israeli official said the current offer from Hamas is unacceptable to Israel and the proposal from Hamas stretches the blueprint offer from April 27th to unacceptable extremes.
• Israeli government said the way for the conflict to end is for Hamas to lay down its arms and return hostages, while a spokesperson called on international organisations to evacuate the Rafah region where the military is operating.
• Israeli Defence Minister said the operation in Rafah will not stop until Hamas is eliminated, according to Asharq News.
• Israeli official said they will move to the second phase of the Rafah operation if there is no progress in the Cairo talks. It was also reported that an Israeli source told CNN the operation in Rafah is limited and aims to pressure Hamas to conclude an acceptable deal, according to Al Arabiya.
• Hamas delegation arrived in Cairo to follow up on Gaza ceasefire negotiations, according to a statement.
• Hamas said Cairo talks are the 'last chance' for Israel to recover hostage talks, according to Al Arabiya. It was also reported that a Hamas official said the group set red lines in the ceasefire negotiations that cannot be conceded, according to Sky News Arabia.
• Hamas official said if Israel's military aggression continues, there will be no ceasefire.
• US State Department said it made its views clear to Israel regarding a major ground invasion of Rafah. It was separately reported that the Rafah assault threatens to be a breaking point for US Democrats, according to Axios.
• White House's Kirby said the US has been told by Israel the Rafah operation was limited and was designed to cut Hamas’s ability to smuggle weapons and funds into Gaza, while he said talks are starting again on Tuesday in Cairo and the US understands from looking at the text of hostage agreement that the gaps should be able to be closed. Furthermore, Kirby said the US hopes to get a deal on Gaza very soon and that everybody is coming to the table.
• Iranian Nuclear Chief Eslami said talks with IAEA's Grossi in Iran have been positive.

OTHER

• Pakistan military spokesperson said multiple ceasefire violations by India on the border.

ASIA-PAC

NOTABLE HEADLINES

• US President Biden’s administration revoked export licences that allowed Intel (INTC) and Qualcomm (QCOM) to supply Huawei with semiconductors as Washington increases the pressure on the Chinese telecoms equipment company, while the move affects the supply of chips for Huawei’s laptop computers and mobile phones, according to FT sources.
• BoJ Governor Ueda had a regular exchange of views with Japanese PM Kishida where they discussed FX and he confirmed with the PM that the BoJ will take into account the impact on the economy and prices which could be potentially big. Furthermore, Ueda said he stands ready to keep a close eye out on how JPY moves affect trend inflation and is to closely monitor how a weak JPY will impact prices, while he explained the BoJ's stance of guiding policy from a standpoint of sustainably reaching the inflation goal.

EU/UK

NOTABLE HEADLINES

• ECB's de Cos said rates can be cut from June if the price path holds, while he added the ECB is data-dependent and cannot commit to a specific rate path. Furthermore, de Cos said they are evaluating a potential CCyB.

DATA RECAP

• UK S&P Global Construction PMI (Apr) 53 vs. Exp. 50.0 (Prev. 50.2)
• German Industrial Orders MM (Mar) -0.4% vs. Exp. 0.4% (Prev. 0.2%)
• German Trade Balance (EUR)(Mar) 22.3B vs. Exp. 22.2B (Prev. 21.4B)
• German Exports MM SA (Mar) 0.9% vs. Exp. 0.4% (Prev. -2.0%)
• German Imports MM SA (Mar) 0.3% vs. Exp. -1.0% (Prev. 3.2%)
• EU Retail Sales MM (Mar) 0.8% vs. Exp. 0.7% (Prev. -0.5%, Rev. -0.3%)
• EU Retail Sales YY (Mar) 0.7% vs. Exp. -0.2% (Prev. -0.7%, Rev. -0.5%)