James Brodie
Head of Learning & Development, Flux
Chinese PMI Bounces, Global Supply Chain Under Pressure
China PMIs improve as yen hits 1986 low; tech sells off, margin debt hits record, and global supply chain pressures rise.
Chinese PMIs bounce, manufacturing to 50.3 from 50, and services to 50.2 from 50.1.
The Japanese Yen collapses to its weakest level versus the US Dollar since 1986. (Bloomberg)
Worldwide supply chain pressures are rising: The Global Supply Chain Pressure Index is up to 1.8 points, the highest since July 2022. This index measures how difficult it is for companies to move goods around the world, with positive readings signaling worsening disruptions. (New York Fed)
Micron fell -7.77% yesterday, wiping out $100 billion from its market cap. One of three companies, alongside Samsung and SK Hynix, named in a federal class action lawsuit filed in California. The suit accuses all three of working together to keep DRAM prices high, which have risen 500-700% over the past four years.
Super Micro Computer stock, falls over -9% on the day on news that the company's office has been raided as Taiwan expands its "chip smuggling" probe.
Microsoft’s worst month since December 2000, down -20.4%. U.S. margin debt keeps rising. May 2026 reading: 53.7%. A new record high in absolute terms, $1.42 trillion borrowed against portfolios. It’s not a problem, until stock prices fall. (TopDown charts, LSEG, FINRA)
The US can't afford higher rates. About $8T of Treasuries roll over in the next 12 months, with an average coupon near 3.3% versus today's ~4% 1-year rate. Refinancing at current levels adds roughly $49B in annual interest costs - before factoring in an ongoing $2T annual deficit. Volcker could crush inflation with double-digit rates because debt-to-GDP had already fallen from ~100% to ~30%. That cushion doesn't exist today.
Written by
More News
Druckenmiller on Bessent, Gold Rally, Trump Escalates Canadian Trade War
Gold surges as China demand, Newmont soars 45%; Trump doubles Canada tariffs while Druckenmiller flags 30Y yield as fiscal check.
Brent Eases As Sinopec Looks Towards Non-Middle Eastern Suppliers
Brent falls as Sinopec diversifies crude sourcing; Hormuz flows persist, while IEA rules out another reserve release for now.
Arb selling down the curve
The gasoline market has diverged regionally this week, as European gasoline strengthened while US prices stagnated and Asian prices weakened
14 page report
Cracks Flat
Cracks in both regions consolidate, with the MOPJ curve outpaces Europe
17 page report