* China unexpectedly cuts key interest rate amid concerns of slowing growth
* US junk loan defaults rise sharply as higher interest rates take a toll
* Japan’s Nikkei 225 stock index rises to highest level since 1990
* A sharp downturn in commercial real estate would threaten big banks
* US regulators seek to block Microsoft’s Activision takeover
* Consumer inflation expectations for year-ahead outlook ease in May: NY Fed

Is low consumer sentiment good for stocks? Possibly, writes John Rekenthaler, director of research for Morningstar Research Services. “When people are deeply unhappy, stocks are likely to thrive, because the economic damage that bothers them has already occurred. A contented populace, on the other hand, is the investment equivalent of red sky at morning. Equity shareholders, take warning.” He concedes that “Glum times are not much fun. If given the option, I would not choose that Americans be deeply pessimistic. There is, however, a silver lining for equity investors, in that such moods have typically presaged strong stock market gains.”