[Platinum Insights] (5.23.23)

Good morning.  

Wall Street futures were subdued on Tuesday after another round of inconclusive talks over increasing the U.S. debt limit, raising the specter of an unprecedented default.   

White House and congressional Republican negotiators will meet again later in the day to discuss how to raise the $31.4 trillion debt ceiling, with just nine days left for the deadline. “If no agreement is reached, the U.S. could default on interest it owes on its debts, sending borrowing costs soaring and shockwaves through the global economy,” Susannah Streeter, head of money and markets at Hargreaves Lansdown wrote in a note.  

Worries over the debt limit pushed yields on one-month Treasury bills to record highs at 5.888%.  

Investors await S&P Global’s flash reading of the U.S. Composite PMI Index for May due later in the day. The Commerce Department’s April personal consumption expenditure (PCE) index reading, the Fed’s preferred inflation gauge, is due on Friday.  

Shares of Lowe’s were down nearly 1% in premarket hours after the company lowered its full-year sales forecast. BJ’s Wholesale and Dick’s Sporting Goods are set to report quarterly results as well.  

WTI crude futures have been trading near the $72 per barrel. Gold weakened toward $1,960 an ounce while the yield on the US 10-year Treasury note rose to 3.72%, the highest since mid-March. The dollar index edged higher to 103.5.  

Trading on the S&P 500 index has been stuck in a 30-point range in the last two sessions as U.S. debt ceiling talks linger, while a mega cap led bounce on the Nasdaq helped it close the previous day higher.