CURRENCY MARKET WRAP 

As of Tue, May 21, Singapore Time zone UTC+8

Dollar Index -0.06%, 97.91
USDJPY, -0.01%, $110.07
EURUSD, +0.10%, $1.1170
GBPUSD, -0.07%, $1.2730
USDCAD, -0.22%, $1.3427
AUDUSD, +0.76%, $0.6921
NZDUSD, +0.27%, $0.6539

U.S. Treasuries finished lower despite the negative disposition in equities. The 2-yr yield increased one basis point to 2.22%, and the 10-yr yield increased two basis points to 2.42%. The U.S. Dollar Index declined 0.06% to 97.91. WTI crude increased 0.9% to $63.30/bbl on rising U.S.-Iran tensions and OPEC producers signaling that production cuts may last throughout 2019.

In Australian elections, Prime Minister Scott Morrison has secured a third term in office for his Liberal-National coalition with a surprise election victory, after Australian voters rejected the Labor opposition’s progressive policy agenda. The shock result has wide-ranging implications for companies, from banks to builders and resources firms, with Labor’s plans to scale back tax incentives for investors and take tougher action on climate change now dead. Australia holds elections every three years but, with infighting rife, no prime minister has succeeded in serving a full term since 2007. Morrison said he had united his government – a coalition between his Liberal Party and its traditional ally, the National Party – in the nine months since he replaced Malcolm Turnbull as prime minister. Aussie gapped higher on Monday’s Open and ended the day higher against the G7.

 

STOCK MARKET WRAP 

S&P500, -0.67%, 2,840.23
Nasdaq, -1.69%, 7,376.70
Nikkei Futures, -0.42%, 21,203.0

S&P 500 declined 0.67% on Monday, led lower by technology stocks. Lingering concerns about Chinese retaliation against U.S. tech companies following U.S. scrutiny of Huawei Technologies dampened general buying interest. S&P 500 real estate (-1.6%), materials (-1.5%), and communication services (-1.2%) sectors joined the tech sector (-1.8%) as the day’s worst-performers. The utilities (+0.2%), financials (+0.1%), and energy (+0.1%) sectors were the lone sectors to finish higher.

Alphabet (GOOG 1138.85, -23.45, -2.0%) and many of the semiconductor companies reportedly began suspending business activity with Huawei to comply with new regulation that requires U.S. government approval to work with the Chinese firm. Lumentum Holdings (LITE 44.42, -1.90, -4.1%) cut its fiscal Q4 guidance to reflect lost business from Huawei.

Apple (AAPL 183.09, -5.91, -3.1%) was a notable underperformer, HSBC cut its price target to $174 from $180. Tesla (TSLA 205.36, -5.67, -2.7%) finished well off its session lows (-7.5%), but it still closed at its lowest level since Dec. 2016 after Wedbush cut its price target to $230 from $275.