Archive for October, 2014

Overnight Flows

Thursday, October 23rd, 2014

I wrote my opening post so early that I had not received much on client flows. Dealers report central banks nibbling on 2s through 5s as those sectors dip in price. Fast money has sold the 10 year sector. Real money has sold one year through three year spread product.

Hoisington Asset Management

Thursday, October 23rd, 2014

Last week I cut and pasted this WSJ feature story on Austin Texas based asset manager Hoisington Asset Management. The firm has been and remains extremely bullish on US Treasuries. The principals at the firm believe that the world is drowning in a sea of debt and a sustained bout ...

October 23 2014 Opening

Thursday, October 23rd, 2014

Prices of Treasury coupon securities have sagged when viewed against levels which prevailed at the close of New York trading. The headline data released overnight was risk friendly and has motivated a sharp rise in US equity futures with S and P gaining about 12 points as of this writing ...

Eclectic Topics from Merrill Lynch Research

Thursday, October 23rd, 2014

Via Merrill Lynch:   Rates, supply weaken bond technicals. As illustrated by the widening in Telecom sector spreads today on the back of the VZ deal, actual and expected supply is weighing on cash bond spreads. That, combined with a sharp fall in interest rates has resulted in significant underperformance of cash ...

What to Watch Today

Wednesday, October 22nd, 2014

Via Bloomberg: WHAT TO WATCH: * (All times New York) Economic Data * 7:00am: MBA Mortgage Applications, Oct. 17 (prior 5.6%) * 8:30am: CPI m/m, Sept., est. 0.0% (prior -0.2%) * CPI y/y, Sept., est. 1.6% (prior 1.7%) * CPI Index NSA, Sept., est. 238.030 (prior 237.852) * CPI Ex-Food and Energy m/m, Sept., est. 0.1% (prior 0.0%) * CPI ...

FX

Wednesday, October 22nd, 2014

Via Marc Chandler at Brown Brothers Harriman: - ECB’s Coene played down some of the excitement on corporate bond-buying, though he did acknowledge that the topic was on the table - The European Commission looks set to take a stronger stance on the EU budget rule, applying pressure on France and Italy - ...

RBSon Bank of England Minutes

Wednesday, October 22nd, 2014

Via a fully paid up subscriber: RBS on MPC Mins: Halt in hawkish drift RBS see a halt in previous 'hawkish drift' within the MPC, with a lower likelihood of the majority shifting to a more hawkish direction (especially given the MPC had seen the 1.2% Sept CPI reading). They believe the majority 7 are ...

Secondary market Corporate Bond Trading Yesterday

Wednesday, October 22nd, 2014

Via Bloomberg: IG CREDIT: Highest Volume Since April; MQGAU, FMSWER to Price 2014-10-22 09:58:58.389 GMT By Robert Elson Oct. 22 (Bloomberg) -- The final Trace count for secondary trading was $17.9b vs $12.8b Monday and $12.2b the previous Tuesday. Tuesday’s volume was highest since $18.1b April 23; $19.5b, the high for 2014, was seen Jan 15. * 10-DMA ...

October 22 2014 Opening

Wednesday, October 22nd, 2014

Prices of Treasury coupon securities have registered modest gains in a relatively lackluster trading session. Today is the one week anniversary of the Great Bond Market Catharsis when the last recalcitrant shorts surrendered to the 2014 price action. The volatility that day was dizzying but it was short lived as ...

Eclectic stuff from Merrill Lynch Research

Tuesday, October 21st, 2014

Via Merrill Lynch:   Out the curve, into US credit. Credit spreads in Europe rallied today on speculation in a Reuters article that the ECB could buy corporate bonds in the secondary market. While such development appears underwhelming as means to expand the ECBs balance sheet and create inflation, not surprisingly iTraxx ...