Today's Update 05-14-2025
Key Points and Metrics
Key Points and Metrics:
Economic Data Releases:
US MBA Mortgage Applications (07:00): Increased by 1.1%, previous was -11.0%.
US MBA 30-Year Mortgage Rate (07:00): Slightly rose to 6.86% from previous 6.84%.
Canadian Building Permits MoM (08:30): Decreased by -4.1%, forecast was -1.2%, previous was revised to 4.9% from 2.9%.
EIA Crude Oil Inventories (10:30): Increased by 3.454 million barrels, forecast was a decrease of -2.209 million barrels, previous was -2.032 million barrels.
EIA Gasoline Inventories (10:30): Decreased by -1.022 million barrels, forecast was -0.938 million barrels, previous was 0.188 million barrels.
EIA Distillate Inventories (10:30): Dropped by -3.155 million barrels, forecast was an increase of 0.12 million barrels, previous was -1.107 million barrels.
Central Bank Speeches:
ECB's Villeroy (09:00) and Holzmann (10:00) delivered speeches; key takeaways were not specified.
Fed's Jefferson (09:10):
Noted that first-quarter GDP data overstated the deceleration in activity.
Mentioned tariffs could lead to higher inflation; uncertain if impact would be temporary or persistent.
Stated that the labor market remains solid.
Current moderately restrictive policy rate is appropriate to respond to economic developments.
OPEC Monthly Report (08:00):
Oil Supply Outside OPEC+ (2025): Expected to rise by 800,000 barrels per day (bpd), previous forecast was 900,000 bpd.
US Oil Supply Growth (2025): Forecast trimmed to 300,000 bpd, down from 400,000 bpd.
OPEC+ Crude Output (April 2025): Averaged 40.92 million bpd, a decrease of 106,000 bpd from March.
Geopolitical Events:
US and Qatar Agreements (10:00):
Signed agreements on defense.
Qatar Airways ordered over 160 Boeing jets worth over $200 billion; the largest order in history.
Russia-Ukraine Situation:
Trump mentioned possible news on Russia-Ukraine developments.
ECB supervisors are stepping up checks on banks' dollar funding over concerns related to Trump administration policies.
Germany's Chancellor Merz expressed concerns over growing closeness between Moscow and Beijing.
China's Commerce Ministry (10:09):
Paused export control measures against 28 US entities for 90 days starting May 14th.
Paused unreliable entity list measure on 17 US entities.
Market Movements:
US Stock Futures and Treasuries:
Posted small moves; investors signal that the equity rally may be losing momentum into the fourth week.
Dollar Index:
Fell by 0.4% amid speculation of the US being open to a weaker dollar to facilitate trade deals.
Currency Strength Chart (03:02):
Strongest: JPY, AUD, CAD, EUR, CHF
Middle: USD, NZD
Weakest: GBP
Crypto Fear and Greed Index (10:18): Scored 73/100, indicating "Greed".
Additional Financial Highlights:
Fed's Goolsbee (05:38):
Emphasized the need for the Fed to wait for more information due to data volatility.
Mentioned it will take time for current inflation trends to reflect in data.
ECB's Nagel (04:26):
Stated that the June rate decision will depend on incoming data.
House GOP Tax Bill:
Advanced by the House Panel on a party-line vote.
US Treasury Secretary Bessent welcomed the move.
Upcoming Earnings Estimates:
May 14th:
Cisco Systems (CSCO): EPS expected at $0.91, Revenue at $14.05 billion.
May 15th:
Alibaba Group (BABA): EPS expected at $1.70, Revenue at $32.93 billion.
Walmart Inc. (WMT): EPS expected at $0.59, Revenue at $165.94 billion.
Global Economic Relations:
Germany's Chancellor Merz:
Expressed intent to avoid prolonged trade conflict with the US.
Aims to deepen cooperation with Britain on defense.
Concerned about dependencies on China; advocates for strategic de-risking.
China-EU Financial Working Group:
Held meetings discussing global economic uncertainty and optimizing market access.
Trade Developments:
Trade-Tariff Deals (10:21):
Reports suggest trade-tariff deals with Japan and South Korea are close.
India deal progress hindered due to tensions with Pakistan.
UK Stance on US Imports:
UK refuses to buy US hormone-fed beef and chicken treated with hormones.
Miscellaneous:
Trump's Comments:
Indicated belief in AI technology.
Mentioned that the US is leading China in crypto.
Economic Policy Updates
US House Majority Leader Scalise: Tax bill to reach Trump's desk before July 4th
Fed's Jefferson: Q1 GDP data overstated activity deceleration
Fed's Jefferson: Labor market remains solid
Fed's Jefferson: Tariffs could lead to higher inflation; uncertain if impact would be temporary or persistent
Upcoming Earnings
May 14: CSCO (EPS est: $0.91, Rev: $14.05B)
May 15: BABA (EPS est: $1.70, Rev: $32.93B)
May 15: WMT (EPS est: $0.59, Rev: $165.94B)
Final Thoughts
The markets appear to be in a cautious holding pattern as the equity rally shows signs of fatigue. Energy markets received a surprise with crude inventories rising significantly against expectations of a decline, while distillate stocks fell to a 19-year low. Geopolitically, we're seeing potential easing of US-China tensions with Beijing's pause on certain trade restrictions, while the massive Boeing-Qatar deal signals strong international commercial relationships. The Fed continues to monitor inflation risks, particularly noting the potential impact of tariffs. Investors should watch upcoming earnings from retail giant Walmart and
Disclaimer: This article is for informational purposes only and does not constitute investment advice. Always do your own research and consider your financial situation before making investment decisions.
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Harry