China fights back, oil gains, and May plans her own exit. Not interestedChinese state media signaled that the country has little interest in resuming trade talks with the U.S. as long as authorities in Washington continue to threaten more tariffs. This means that the next opportunity for both sides to come together will be a meeting between Presidents Donald Trump and Xi Jinping at the G-20 summit towards the end of next month. The nation's equity markets were hit after the media reports were published, with the Shanghai Composite Index tumbling as much as 2.8%, while the yuan briefly fell to its weakest level against the dollar since November. Good weekA barrel of West Texas Intermediate for June delivery was trading at $63.32 by 5:40 a.m. Eastern Time as the commodity is in line for its best week since early April. The gain belies warnings over global demand and market volatility since Iran became a renewed focus of tension. There may be some relief on that front as people familiar with the matter say that Trump is wary about drawing the U.S. into a war in the region which may hurt his chances of reelection. OPEC and its allies meet this weekend in the Saudi Arabian city of Jeddah, with the Iran situation expected to dominate the agenda. MexitBritish Prime Minister Theresa May was forced by members of her own party to agree to set a timeline for her to quit as leader. Under the terms she will try one more time to get her Brexit deal through Parliament and then, regardless of the outcome of that vote, will leave her position. On Brexit, the opposition Labour Party this morning said that talks with the government have gone as far at they can, increasingly the likelihood of Parliament rejecting May's deal for a fourth time. The pound fell to the lowest since January. Markets mixedOvernight, the MSCI Asia Pacific Index was broadly unchanged, while Japan's Topix index closed 1.1% higher with a rebound in electronics makers and positive earnings boosting the gauge. In Europe, the Stoxx 600 Index was 0.3 percent lower at 5:40 a.m. Eastern Time as trade fears again came to the fore. S&P 500 futures pointed to a drop at the open, the 10-year Treasury yield was at 2.387% and gold eased. Coming up…It's a fairly quiet day on the economic data front, with the U.S. April Leading Index and May University of Michigan consumer sentiment at 10:00 a.m. Oil-market watchers, already with a lot to keep an eye on, will get the latest Baker Hughes rig count at 1:00 p.m. In Fed speakers today, New York Fed President John Williams and Fed Vice Chair Richard Clarida are the lineup. There's interest in Deere & Co. earnings this morning as the company faces fallout from the trade war and difficulties among its U.S. farmer customer base. What we've been readingThis is what's caught our eye over the last 24 hours. Want the lowdown on European markets? Get the European edition of Five Things in your inbox before the open, every day. And finally, here's what Luke's interested in this morningSovereign debt is the Debbie Downer of financial markets. Investors are wrestling with mixed U.S. data, underwhelming global growth, and an escalating trade war. While other asset classes have telegraphed optimism, sovereign debt is signaling a degree of caution, if not abject fear, about what comes next. While U.S. stocks are barely down on the week through Thursday after collapsing on Monday, Treasury yields are decisively lower. Bund yields are solidly sub-zero. In the case of Europe, Bank of America's survey of investors found that "many respondents believe the ECB doesn't have the tools to lift inflation & some now see inflation as beyond'' the European Central Bank's control. To be fair, in the case of U.S. debt, there's an extenuating circumstance contributing to this week's decline in yields: convexity hedging 2.0 on the part of holders of mortgage-backed securities. Another note of caution for Treasury bulls: expectations that the Federal Reserve is poised to ease – and perhaps materially – by the end of 2020 has helped juice the rally in longer-term debt. But patience – the central bank's mantra – is almost definitionally incompatible with a proactively accommodative posture. Even Minneapolis Fed President Neel Kashkari – arguably the most dovish member of the FOMC – does not think a so-called "insurance" rate cut is appropriate. A more hawkish member – Kansas City chief Esther George – thinks a rate reduction could fuel financial excesses. If the market switched to betting the Fed will stay on hold this year, and if 10-year yields moved in lock-step with fed funds futures, then 10-year Treasuries would be north of 2.60% and trading closer to the 2019 highs than the trough.  Like Bloomberg's Five Things? Subscribe for unlimited access to trusted, data-based journalism in 120 countries around the world and gain expert analysis from exclusive daily newsletters, The Bloomberg Open and The Bloomberg Close. Before it's here, it's on the Bloomberg Terminal. Find out more about how the Terminal delivers information and analysis that financial professionals can't find anywhere else. Learn more. | 
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