In the movie Seven Days in May, an unpopular President is preparing to sign a nuclear disarmament treaty. However, the famous chairman of the Joint Chiefs of Staff and presidential candidate in elections two years away plots to remove the president from office.

Something about our current political predicament makes me think about this movie a lot. It’s a classic and worth skipping those crappy reality television shows to check out.

Today is also the seventh trading session of May, and thus far, it's been a great month. In fact, it's been the fourth-best May for the S&P 500 to this point.

It's not a coincidence that the Volatility Index (VIX) is also down for six straight sessions, closing yesterday at 13.0.

History suggests this is a bad thing for stocks, but recently, the lower the VIX, the better the stock market.

We begin the session with up arrows for various lengths of time.

No Swagger

The Fear & Greed Index is in ‘fear’ 18 consecutive sessions.

The S&P 500 is consolidating its rebound above the 50-day moving average as the Relative Strength Index (RSI) indicates more upside, and the Rate of Change (ROC) remains strong.

But the real test is climbing above 5,250.

Massive Bond Offering

This week, the Treasury will raise $125 billion. Runaway government spending is stripping this country of its muscles - all for an ideology doomed for failure.

On Tuesday, there was strong demand for $58.0 billion in three-year bills, but yesterday was tougher sledding for $42.0 billion in ten-year notes:

When issued: 4.473%

• High yield: 4.483%

The 1.0 basis points (bps) tail isn’t a great sign, although it is par for the recent course. There was less international demand (indirect), 65.52%, than the six-week average of 66.10%.

Treasury auctions $25.0 billion in 30-year bonds today.

Today’s Session

 

Initial jobless claims of 231,000 are far above the consensus of 214,00 and the highest level since August 2023.

The bad news not helping much, as the financial reporting carnage continues with huge blows, including very popular stocks:

• Airbnb (ABNB)
• Roblox (RBLX)

These hits are overdone, but the environment is such that only nimble traders dare play the bounce game.  For everyone else, that time will come when there is less smoke.

The good news is bad economic news is mounting and many stocks are oversold.

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