U.S. stocks closed the week in the red with the NASDAQ making the greatest losses at -1.04%. The DOW and S&P closed 0.38% and 0.58% down respectively. The Trump administration lifted steel and aluminium tariffs on Canada and Mexico in an effort to get lawmakers to ratify the new NAFTA. The nations have decided to instead step up measures to trace the origins of metals to stop diversion of shipments from other countries hoping to dodge tariffs. The move is meant to give an edge to local primary metal producers in the three nations. Yield on 10Y USTs closed 4bps lower at 2.3424.


Labour leader Jeremy Corbyn walked out on Theresa May on Friday. Writing to her, he said cross-party talks to find a Brexit deal had “gone as far as they can,” citing the instability of the Tory government, as May faces an ouster, among other reasons. Corbyn went on to suggest that a second referendum should be held assaying the public should be given a choice on deals to leave the EU. With Tories themselves already jostling to take over from May, there seemingly won’t be much support for the next Brexit deal May delivers for a vote. The pound continued the slide against the dollar closing at 1.2724 while yield on 10Y UKTs was 4bps lower at 1.0329%.


The successor to Angela Merkel in her Christian Democrats party is urging the incumbent to resign after European parliament elections. Annegret Kramp-Karrenbauer is suggesting that the chancellor run for the European leaders council presidency instead. While Merkel is determined to serve her full term until 2021, AKK (as Kramp-Karrenbauer is known) may no longer hold enough sway then to run for the German top job as she has failed to gain traction in the polls and in her party. Yield on 10Y DBRs lost 1bp to -0.1053% while the euro was about flat closing at 1.1158 to the dollar.


Asian markets were down in afternoon trading on Monday amid increasing tensions with the US; Huawei’s Android licence was revoked by Google essentially blocking the Chinese tech giant from any meaningful access to Google’s proprietary apps – Gmail, YouTube, etc.  The Hang Seng was down 0.64% while the CSI was 0.84% lower. The Nikkei however bucked the trend as it was 0.24% up on the back of stronger-than-expected Q1 growth with annualized growth of 2.1% when economists had predicted flat or negative growth.


Saudi Arabia and other key producers in OPEC signaled their intent to keep oil supplies constrained for the rest of the year, while committing to prevent any real shortages. Oil prices rallied on Monday in the wake of the news with brent climbing to $73.18 a barrel. Russia, the main partner in the extended OPEC+, was less clear whether it would support the curb having only started to meet its targeted cut this month since January with Energy Minister Alexander Novak wanting to wait and see what happens in the next month.


{TU} The US is cutting tariffs on Turkish steel to 25% from 50% reversing the decision taken last August amid heightened diplomatic tensions. The move, announced on Thursday, was motivated by evidence of a marked drop in steel imports from Turkey over the past year but the tariff reduction merely brings them back in line with those imposed on other countries. The shift on tariffs was complemented by the announcement that Turkey was being removed from a list of developing economies that benefit from preferential trade treatment in the US, the justification being that Turkey had met certain benchmarks for economic development, thereby graduating from the programme. The lira was about flat closing at 6.0553 to the dollar while TURKEY 47s closed the week slightly higher at 79.152.


The Argentinian presidential race took a turn on Saturday when former president Christina Fernandez announced she would run for the vice-presidency instead. Having been tipped to announce her candidacy due to her strong showing in the polls, she instead opted to support her former cabinet chief Alberto Fernandez – no relation – who will run for presidency. Analysts are suggesting this could tip the electoral scales in their favour as Mr Fernandez is considered less of a radical than the former president while he’ll be riding on Ms Fernandez’ populist support. ARGENTINA 47s were about flat closing at 66.320 while the peso slid closing at 45.0175.


The non-resident share of Russia’s government Eurobonds is above 50% for the first time since 2015. Fading concern over US sanctions and the appeal of higher emerging-market yields have helped grow the foreign demand spilling over even into ruble-denominated offerings. RUSSIA 47s closed higher at 104.085 while the ruble was slightly lower at 64.7699 to the dollar.


{ZM} {KN} According to a Bloomberg report on Zambia, President Lungu will engage his cabinet and commence take-over of the Vedanta Unit Konkola Copper Mines’ assets. The Capital Markets Authority in Kenya has approved the offer document related to Kenya Commercial Bank (KCB) Group’s proposed acquisition of 100% shareholding in National Bank of Kenya. The deal will occur through a share swap, where shareholders will exchange 10 ordinary shares for 1 ordinary share of KCB Group.