Daily Market Color June 8, 2017US Financial Markets Hold Steady Following Comey Testimony Today’s much anticipated testimony of former FBI Director James Comey did little to alter the ambiguity surrounding the Trump administration’s conduct both pre- and post-election. The open hearing with the Senate Committee lasted a total of two and a half hours and detailed Comey’s interpretations of past interactions with President Trump before being fired in early May. Comey did not go as far as to provide his opinion on whether Trump obstructed justice with regards to the probe into former National Security Advisor Michael Flynn, but he did convey his skepticism of Trump’s intentions when the two met in private. He explained that he had created memos following these meetings, as a result of the fear that Trump “might lie” during their conversations, and that he later leaked these memos with the hopes that the disclosures would lead to the appointment of special counsel. Comey left open the possibility that he “could be wrong” in his conclusions surrounding his interactions with Trump, but defended his belief that Trump’s request to end the probe on Flynn was a “direction.” Shortly after the conclusion of the testimony, President Trump’s personal attorney issued a statement dismissing several of Comey’s comments as inaccurate, leaving many questions as to where the truth lies. All three major US stock indices edged higher on the day, as gains in bank shares outweighed the declines of energy stocks whose prices fell with the continued slump in oil. Treasurys maintained a modest selloff throughout the trading session, and yields/swap rate were up 1-3 bps across the curve, with the 10-year note yield at 2.19%. The ECB meeting concluded this morning with the decision to leave the existing monetary policy in place – as expected. There was a mildy hawkish tone struck in the comments afterwards with the removal of the pledge to cut rates if necessary, and the risks to the growth outlook of the region were characterized as “broadly balanced.” In a news conference afterwards however, ECB President Mario Draghi expressed his concern of stagnant inflation and its potential to overshadow the prospect of improved economic advancement. Draghi warned that “measures of underlying inflation continue to remain subdued. Therefore, a very substantial degree of monetary accommodation is still needed.” The euro declined 0.4% during today’s session to $1.121/EUR. The final poll results are not in as of the writing of this commentary, but the British pound is dropping roughly 2% as the exit polls start to come in, and it appears that the Conservative Party has lost its majority. Another light day of economic data releases featured initial jobless claims for the week ended June 3. The number of Americans filing for unemployment benefits for the first time last week totaled a seasonally adjusted 245,000, a 10,000 decline from the previous week’s revised level. The four-week moving average of claims increased 2,250 to 242,000, albeit remained well below the 300,000 threshold associated with a healthy labor market. Also included in the Labor Department’s report, the number of continuing claims for week ended May 27 inched lower to 1.92 million, marking eight straight weeks of sub-2 million claims as the labor market continues to tighten.