Archive for February, 2014
Wednesday, February 26th, 2014
Colgate Palmolive is a wonderful American company which has produced toothpaste for as long as I can recall. That company is issuing 5 year bonds and 10 year bonds today. Now the company has nice financials in a boring stable industry. I visited the company website and as best I ...
Posted in Uncategorized | Comments Off on Afternoon Nuggets
Wednesday, February 26th, 2014
Via Bill O Donnell at RBS:
Treasury auctioned $35bn in new 5yr notes at 1.530% versus a 1pm level of 1.537% so the auction came THROUGH by 0.7bp.
-0.7bp thru (6-auction average 0.6bp tail)
Bid/Cover 2.98X (6-auction average 2.55X) *best since Sept. 2012*
Indirects 50.7% (6-auction average 41.9%) *above average*
Directs 9.2% (6-auction ...
Posted in Uncategorized | Comments Off on Five Year Auction Results
Wednesday, February 26th, 2014
Via CRT Capital:
• 5s have recently seen weak receptions with all but one of the last eight auctions tailing for an average of 0.72 bp. A longer history shows 5s tail 67% of the time.
• Foreign buying has decreased recently, taking 12% at the last four auctions vs. 13% at ...
Posted in Uncategorized | Comments Off on CRT Capital on the 5 Year Note Auction
Wednesday, February 26th, 2014
As an aging baby boomer there is something sacred about Paul McCartney's rendition of the ballad "Yesterday" In an act bordering on blasphemy a Washington Post editorial writer, Rachel Manteufell, conducts a thorough exegesis of that famous piece of popular music and casts aspersions on both the lyrics and baby ...
Posted in Uncategorized | 4 Comments »
Wednesday, February 26th, 2014
I have heard of better buying in the Treasury market. End user clients have been selling older issues and rolling into both WI 5s and WI 7s. Hedge funds have bought off the run 3 year paper and end user types have been outright buyers of 4 year paper.
Goldman Sachs, ...
Posted in Uncategorized | Comments Off on Morning Miscellany
Wednesday, February 26th, 2014
The US Treasury will offer a chunk of 5 year notes to dealers and investors at 100PM today. I think that there will be a robust bid for this issue. I think that traders are short the supply on both yield curve trades and outright basis. The bond market has ...
Posted in Uncategorized | Comments Off on Five Year Note Auction
Wednesday, February 26th, 2014
Via TD Securities:
The pace of new home sales defied expectation, with a sizable 9.6% gain in sales activity to a new cycle high of 468K in January. This was a far better outcome than the market consensus for a drop to 414K, from the upwardly revised 427K pace the month ...
Posted in Uncategorized | Comments Off on Home Sales
Wednesday, February 26th, 2014
Via Bloomberg:
Wednesday - Feb 26
#$5b European Investment Bank (EIB) Aaa/AAA
Global 3Y MS +5 C/DB/MS
$b Goldman Sachs Group (GS) Baa1/A- GS
Global 10Y IPT +145area
$b Caterpillar Financial (CAT) A2/A C/Barc/JPM
$m 3Y FRN 3ML +equiv ...
Posted in Uncategorized | Comments Off on Corporate Supply This Far
Wednesday, February 26th, 2014
I am not a technician nor do I pretend to be but David Ader at CRT Capital points out in his note this morning that the 30 year bond is flirting with its 200 day moving average at 3.664. He suggests that if we break that level then the 200 ...
Posted in Uncategorized | Comments Off on Moving Average
Wednesday, February 26th, 2014
Hilsenrath at the WSJ has an interesting article on bubbles and the bursting of those bubbles by the central bank. He notes that the Federal Reserve appears to be warming to the notion that if low rates created the bubble maybe it will take higher interest rates rather than something ...
Posted in Uncategorized | Comments Off on Hilsenrath on Interest Rate Policy and Bubbles