GOOD MORNING! Treasury yields, which were lower overnight Monday, Geo-political developments and conflicting stories on negotiations remained a source of market volatility on Monday, continued to ebb lower at the US’s cash market opening. They leveled off mid-morning as stocks pared overnight losses, ahead of the 6-week and 2-year auctions and ongoing conflicting stories on the Iran-US negotiations. One dispute was over whether Iran had agreed to allow UN inspectors to view bombed nuclear sites. Iran had said it hadn’t while the US said it had. There was also confusion over routes out through the Strait of Hormuz amid conflicting instructions from Iran and the US. The two countries also appeared to disagree on the release of frozen Iranian assets. In the meantime, it was reported that Iran and Oman were working together on a pact for Hormuz transit costs. The 2-year T-note auction was characterized as fair, even during a $25 billion SpaceX corporate bond offering was being underwritten and offered to the public. The rout in tech stocks came off their overnight lows but the NASDAQ still a posted sizeable loss.

     Treasury yields have re-connected and are ebbing lower along with oil this morning. The bias toward optimism is also showing back up in stocks as the S&P and NASDAQ futures contracts are rebounding. Having said (or written) that, there is still a cautious undertone to the markets with traders just waiting to hit either the Sell or Buy button. Today’s only relevant release is May’s new home sales, leaving the markets to watch for headlines and digest $69 billion 17-week T-bills, $28 billion 2-year Floating Rate Note and $70 billion 5-year T-note. The markets may also be waiting on tomorrow’s data which will include more Fed District surveys, jobless claims, personal spending, income, savings and PCE Deflators.