Stocks opened lower but have since clawed back some of those losses. Debt ceiling negotiations have continued for another day without a deal. Talks on Monday were described as productive, but there is now just 1 week left to reach a deal before a potential default on June 1.
For economic data today, new home sales unexpectedly rose 4.1% in April to annual rate of 683,000, the highest level since April 2022. The prior was revised down to 656,000. The report showed the median sales price was $420,800, down 8.2% from the previous year. The report also showed a home supply of roughly 7 months at current sales rates.
The May flash reading for the S&P Global U.S. Services PMI rose to 55.1, the highest level in 13 months. The Manufacturing PMI fell to 48.5, back into contraction territory and the lowest level in 3 months. The Composite PMI was 54.5, also the highest level in 13 months. Overall, growth output seen in May was the fastest in over a year.
Treasury yields are flatter, with the 2-year T yield up 4.1 basis points to 4.36%, the 5-year T yield up 0.6 basis points to 3.77%, and the 10-year T yield up 0.2 basis points to 3.72%. Advance rates are higher throughout the curve today.