In partnership with

Welcome Back,

Market Headlines 👀 

• US markets rallied across the board seeing EU has shown a willingness to negioate on tariffs.

• US President Trump delays EU tariffs until July 9th.

• US consumer confidence rises to 98 , up from 12 points in April.

• Square (XYZ) announces it will integrate Bitcoin as a payment option in its PoS systems.

• Salesforce (CRM) announces it will buy Informatica for $8b.

• X (TWTR) massive Twitter outage occurred over the weekend.

A note from Pacaso 📣

Top investors are buying this “unlisted” stock

When the team that co-founded Zillow and grew it into a $16B real estate leader starts a new company, investors notice. That’s why top firms like SoftBank invested in Pacaso.

Disrupting the real estate industry once again, Pacaso’s streamlined platform offers co-ownership of premier properties – revamping a $1.3T market.

By handing keys to 2,000+ happy homeowners, Pacaso has already made $110m+ in gross profits.

Now, after 41% gross profit growth last year, they recently reserved the Nasdaq ticker PCSO. But the real opportunity is now, at the unlisted stage.

Until May 29, you can join Pacaso as an investor for just $2.80/share.

Invest before the window closes.

_{This is a paid advertisement for Pacaso’s Regulation A offering. Please read the offering circular at invest.pacaso.com. Reserving a ticker symbol is not a guarantee that the company will go public. Listing on the NASDAQ is subject to approvals. Under Regulation A+, a company has the ability to change its share price by up to 20%, without requalifying the offering with the SEC.}

S&P 500 Heatmap 🔥 

Recap Around the Street 🧠

Global bond markets let out a primal scream last week that was reminiscent of a fully-“seen” millennial singing along to The Tortured Poets Department at max volume (IYKYK).

Long bond yields spiked higher (prices fell) around the globe as a confluence of events conspired to dampen demand for duration risk and even cause (some) equity markets to lurch lower. The key point here is that it was, in fact, a confluence of events (or, as TSwift sings, “a litany of reasons why”) and not just one driver behind this jump higher in yields. These reasons include:

• The Moody’s downgrade of U.S. federal debt last week caused the U.S. to lose its second-to-last AAA rating. Some Treasury market investors, like Hong Kong pensions, could be forced sellers were the U.S. to lose its last AAA rating (though there would likely be workarounds if this were to transpire).

• The House passed a deficit-ballooning reconciliation bill that’s projected to add $3.3 trillion to the deficit over the next 10 years. This bill has to go to the Senate, which is likely to mark it up significantly with fewer tax breaks (there is not as much pressure in the Senate to raise SALT caps, for example) but also fewer spending cuts (there is little appetite in the Senate to push through big cuts to Medicaid, for example). On balance, given the Senate’s distaste for spending cuts, its version could be even more deficit-amplifying than the one voted out of the House.

• A weak 20-year U.S. Treasury auction on Wednesday raised questions about investor appetite for duration.

• A very weak 20-year bond auction in Japan, the weakest demand since 1987, amplified questions about the future path of the Bank of Japan’s tapering of bond purchases (recall the BOJ owns half of the outstanding JGBs!)

• Canadian core inflation came in hot.

• Ditto in the UK.

• U.S. manufacturers continue to experience and expect further price increases. The S&P Global Prices component rose to its highest level since 2022. We should note that actual inflation data has cooled recently, but that tells us little about whether higher inflation could be around the corner.

• Broad concerns about fiscal sustainability are likely putting upward pressure on global bond term premium, which is the extra compensation investors demand to lend for longer periods of time (see below for the chart of Google searches for “Liz Truss Moment” spiking, proving that the legacy of her budget deficit “yip” from 2022 has more staying power than a head of lettuce).

• Yields tend to be correlated across developed markets, meaning a move in the U.S. Treasury market can impact German bunds or JGBs, and vice versa.

• Global recession odds have fallen somewhat as worst-case trade fears abate (we typically see increased demand for “safe haven” government debt when concerns about economic growth rise, so if economic growth concerns are fading, there is less demand for safe bonds at the margin). Corroborating this, we see some global equity indices, like the MSCI EAFE International Developed Index, hitting new all-time highs. This would not be the case if global recession odds were rising.(Contributed by Cameron Dawson, CIO at NewEdge Wealth).

(Contributed by Cameron Dawson, CIO at NewEdge Wealth).

Markets running hot the past three sessions, seen below:

Market Preview 🎞️ 

• Tuesday, May 27th: Consumer confidence; Durable goods

• Tuesday earnings: Pinduoduo (PDD), and Okta (OKTA) 

• Wednesday, May 28th: MBA mortgage applications

• Wednesday earnings: Nvidia (NVDA), Salesforce (CRM), c3AI (AI), Dicks sporting goods (DKS), and Sentinel One (S)

• Thursday, May 29th: Weekly jobless claims; Q1 second GDP estimate; Pending home sales

• Thursday earnings: Costco (COST), Zscaler (ZS), Ulta Beauty (ULTA), Dell Technologies (DELL)and Marvell (MRVL) 

• Friday, May 30th: University of Michigan consumer sentiment final; Personal income and spending (PCE)

Enjoy reading?👇

That’s all for today, folks! We’ll be back around the same time tomorrow with a curated list of important news, economic data and market highlights. 

🔔 Be the first to know. Ensure you never do more than one read if you:

• Move our emails (especially your subscriber introduction) to your primary inbox (Quick instructions).

• 👋 Say hi. Responding to our emails (if any) lets your email provider know to not block us from your main inbox.