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10-year holds below 0.6% as investors brace for more harrowing jobs data



At around 2:00 a.m. ET, the yield on the benchmark 10-year Treasury note, which moves inversely to price, was sharply lower at 0.5830% while the yield on the 30-year Treasury bond was down at 1.2112%.

Risk aversion from investors amid the deepening coronavirus crisis continued to plague Wall Street on Wednesday, sending the Dow 4.4% lower.

U.S. jobs data will be in focus Thursday, with last week’s initial jobless claims due for publication at 8:30 a.m. ET.

The figure is expected to be significant, with economists expecting that between 4 million and 5 million workers filed jobless claims last week, with many more anticipated as lockdowns continue to take their toll.

Four new states announced lockdown guidance on Wednesday, meaning more than 80% of Americans have now been directed to stay in their homes, according to Reuters, as the number of deaths and cases surged to new daily highs for a fourth consecutive day.

More than 216,000 cases have now been confirmed in the U.S. as of Thursday morning, with more than 5,000 deaths.

In terms of other economic data, balance of trade and import/export figures are also due at 8:30 a.m. ET.

Auctions will be held Thursday for $80 billion of 4-week Treasury bills, $60 billion of 8-week bills, and $40 billion each of 154-day and 102-day bills.



China Says U.S. Politicians Pushing Nations Into 'New Cold War'



May.24 — Foreign Minister Wang Yi said the U.S. should give up its “wishful thinking” of changing China, warning that some in America were pushing relations to a “new Cold War.” The bilateral relations have worsened dramatically in the past few months as America became one of the countries worst hit by the coronavirus pandemic, which was first discovered in the Chinese city of Wuhan. Selina Wang reports on “Bloomberg Daybreak: Australia.”


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Asia trades higher as China’s annual parliament meeting continues



Asia markets rose in early trade on Monday as investor sentiment remained resilient despite growing concerns over the U.S.-China relationship. 

Australia’s benchmark ASX 200 was up 1.46% at 5,577, with all sectors trading higher. In Japan, the Nikkei 225 index rose 1.3% while the Topix index was up 1.2%. South Korea’s Kospi gained 0.19%. 

Markets in Singapore, India and Indonesia were shut due to public holidays. 

Asia Pacific markets declined on Friday after China announced a new national security law, which, if implemented, would give Beijing more control over Hong Kong and may incite further pro-democracy protests in the city. The draft measure was announced as China’s National People’s Congress (NPC) — the country’s parliament — kicked off its annual session and will last until May 28. 

“Risk sentiment proved resilient, on Friday night, to concerns about the fallout from China introducing national security legislation in Hong Kong. Weakness in Asian equities gave way to a flattish European session, and mild positivity in the US,” Hayden Dimes at ANZ Research said in a Monday morning note. 

Still, China’s announcement drew criticism from U.S. officials. White House national security advisor Robert O’Brien said on Sunday that if Beijing goes ahead with implementing the controversial law, the U.S. government will likely impose sanctions on China. 

Chinese Foreign Minister Wang Yi told reporters on Sunday that some political forces in the United States were taking the bilateral relation “hostage” and pushing the two economic powerhouses to the brink of “a ‘new Cold War’,” according to an official English translation of his remarks posted by the foreign ministry. 

The U.S. dollar traded at 99.736 against a basket of its peers at 8:14 a.m. HK/SIN versus its previous close at 99.863. 

Currency strategists at the Commonwealth Bank of Australia said in a morning note that the dollar faces upside risks this week. “Rising tensions can put the US-China Phase One trade deal at risk. Although not our central scenario, if the US or China were to withdraw from the Phase One deal, (the dollar) would sharply appreciate,” they wrote. 

The Japanese yen changed hands at 107.73 per dollar, strengthening from levels near 108 in the previous week. Meanwhile, the Australian dollar traded up 0.12% at $0.6543. 


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3D printing in ‘valley of despair,’ but may have a catalyst: Ark CEO



There are two sides to the story of 3D printing stocks.

Shares of industry stalwarts Stratasys and 3D Systems have fallen around 90% from their 2014 highs, struggling to hang onto gains as the coronavirus pandemic put a strain on consumer demand. In the meantime, competitors Proto Labs and Materialise NV have seen their stocks soar, up almost 75% and over 92% in the same time frame.

So, what gives?

Catherine Wood, the CEO and chief investment officer at Ark Invest, which runs an exchange-traded fund partly focused on 3D printing, says the group has seen an important divergence in recent years.

Currently, “it’s in the valley of despair,” she told CNBC’s “ETF Edge” on Monday. “Many stocks are down 80 to 90% from their highs because their focus was on the consumer space and not on the industrial space.”

“Crisis creates opportunity, and that it is going to accelerate the demand for 3D printing.”

Wood’s firm presides over the Ark Autonomous Technology & Robotics ETF (ARKQ), formerly known as the Industrial Innovation ETF. Its top holding is Tesla at 11% of the portfolio, followed by Proto Labs at 10%, education software company 2U at 8%, Stratasys at 6.5% and Materialise at 6%. ARKQ is up almost 17% year to date.

But there could be a new near-term catalyst for the space as the pandemic pressures industries like travel, Wood said. Aircraft manufacturer Boeing has said that air travel could take up to three years to recover. 

“Boeing and Airbus, their gross margins are in the 15-20% range,” Wood said. “Now that the FAA is approving it, 3D printing can cut those costs by up to 90% as well as lower the weight and form factors of the various parts in engines and shrink the number of parts. … Given the turmoil and trouble it’s in right now, [the aerospace industry] is going to seek out even more aggressively some of these new technologies that are going to help it get back to profitability.”

In short, “crisis creates opportunity, and that it is going to accelerate the demand for 3D printing,” Wood said — and that demand won’t just come from aerospace companies.

“There are many medical applications … that are going to submit to 3D printing because 3D printing allows for such incredible customization,” she said.

That could include artificial hips and knees, Wood said, adding that a majority of hearing aids are, in fact, 3D printed.

“Cloud ETFs have brought in over $1 billion year to date.”

Jay Jacobs

Head of Research and Strategy, Global X ETFs

Automobile manufacturers could also soon turn to 3D printing in a big way as they run into demand issues, the CEO said.

“They are going to be turning to new technologies that are going to help them lower their costs, lower the fuel consumption in terms of weight and, ultimately, create different form factors,” Wood said. “We think that entire autos, ultimately, will be 3D printed.”

All this goes to show that not all industries are subject to weakness in the face of the pandemic, Jay Jacobs, head of research and strategy at Global X ETFs, said in the same “ETF Edge” interview.

“Investors are recognizing that disruptive technologies [are] not only not really harmed by what we’re seeing during Covid-19, they’re actually some of the biggest beneficiaries,” he said.

Jacobs cited his firm’s Global X Cloud Computing ETF (CLOU) as an example. CLOU has climbed nearly 23% this year.

“It’s holding companies that are facilitating video conferencing. It’s holding companies that are facilitating governments communicating with their local constituents about emergency response or companies communicating with their customers all through software, through the internet, through these different types of cloud infrastructure, and that is just how the world is working during this stay-at-home environment,” Jacobs said.

CLOU’s top holdings are Twilio at 6%, Everbridge at 5%, Zoom Video at 5%, Shopify at 5% and Coupa Software at 4%.

“We’re seeing a lot of interest in cloud and robotics right now, and cloud in particular. Cloud ETFs have brought in over $1 billion year to date with most of that money coming in just in April,” Jacobs said. “So, investors certainly realize that cloud computing has become really the key to the economy right now.”

ARKQ ended trading up less than 1% on Friday. CLOU rose nearly 2%.



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