European stocks, Portuguese bonds fall on Greek tensions

•      European stocks, Portuguese bonds fall on Greek tensions

–    Following weekend municipal elections in Spain & comments by Greek officials, most European stock markets fell sharply yesterday and Portuguese bond yields soared.

–    It’s questionable whether Greece can make the EUR 308mn in payments to the IMF coming due in June.

–    Failure to meet payments could result in anything from a short deadline to reach agreement with creditors (as happened with Cyprus) to ECB pulling the plug on banks, capital controls setting in, and...who knows. VERY EUR-DANGEROUS!

•      China is in a world of its own

–    Meanwhile, Shenzhen stocks up 2.8% today, while an IPO was 826x oversubscribed

•      Today:

–    Eurozone: No major releases

–    Sweden:  PPI for April could keep SEK under selling pressure

–    US: A busy day! Durable goods orders – watch the core (ex-transportation) figure to see if business investment is coming back. New home sales for April & FHFA housing price index for March could show housing rebounding. Conference Board leading index, Richmond Fed manufacturing index, Markit service-sector PMI, and Dallas Fed manufacturing index, all for May, plus S&P/Case-Shiller house price index for March

–    Speakers:  Fed Vice Chairman Fischer speaks on Global Economic Developments