Archive for March, 2015

Overnight Flows

Friday, March 6th, 2015

It was a very quiet overnight session as participants await the monthly labor report Godot.Dealers report Japan based end users buying in the 2 year sector. Non Japan Asia investors bought 7 year spread product. Fast money sold the belly to buy the wings. The yield curve is a tad flatter ...

China at the Crossroads

Thursday, March 5th, 2015

Ambrose Evans Pritchard writes for the UK Telegraph. He wrote a very long piece yesterday on the problems confronting China. He writes that the world's second largest economy is engaged in contractionary fiscal policy which will motivate a harder landing than most expect.

FX

Thursday, March 5th, 2015

Via Marc Chandler at Brown Brothers Harriman: Dollar Firm, Euro Heavy Ahead of ECB - The euro remains heavy as the market awaits the ECB's press conference where Draghi is expected to provide more details on the bond buying program - The Bank of England meeting is a non-event today - China lowered ...

What to Watch for Today

Thursday, March 5th, 2015

Via Bloomberg: WHAT TO WATCH: * (All times New York) Economic Data * 7:30am: Challenger Job Cuts, y/y, Feb. (prior 17.6%) * 8:30am: Non-farm Productivity, 4Q final, est. -2.3% (prior -1.8%) * Unit Labor Costs, 4Q final, est. 3.3% (prior 2.7%) * Unit Labor Costs, 4Q final, est. 3.3% (prior 2.7%)</li></ul> * 8:30am: Initial Jobless Claims, Feb. 28, est. ...

China Lowers Growth Target to 7 Percent

Wednesday, March 4th, 2015

Via WSJ: By Mark Magnier Updated March 4, 2015 8:43 p.m. ET BEIJING—China lowered its economic growth forecast to about 7% this year at the opening of the country’s biggest political event of the year, ushering in what leaders have dubbed a “new normal” of slower growth in the world’s second-largest economy. Premier ...

On Corporate Bond Spreads

Wednesday, March 4th, 2015

Via Merrill Lynch Research: From weakness to strength. Spreads on our high grade corporate bond index are now 23bps off their end-of-January local wides of 153bps - note though that 5bps was related to downgraded names like Petrobras leaving the index. This sharp rally in spreads happened as 5-year, 5-year forward ...

FX

Wednesday, March 4th, 2015

Via Marc Chandler at Brown Brothers Harriman: Dollar Firms, Euro Slides As Service PMIs Disappoint - BOC Governor Poloz dampened expectations for a cut today with last week's reiteration that the January rate cut was an insurance policy to buy time - The Reserve Bank of India surprised with yet another unscheduled rate ...

What to Watch for Today

Wednesday, March 4th, 2015

Via Bloomberg: WHAT TO WATCH: * (All times New York) Economic Data * 7:00am: MBA Mortgage Applications, Feb. 27 (prior -3.5%) * 8:15am: ADP Employment Change, Feb., est. 219k (prior 213k) * 9:45am: Markit US Composite PMI, Feb. final (prior 56.8) * Markit US Services PMI, Feb. final, est. 57 (prior 57) * Markit US Services PMI, Feb. ...

Secondary Market Corporate Bond Trading Yesterday

Wednesday, March 4th, 2015

Via Bloomberg: IG CREDIT: PETBRA Issues Led Trading; BOEN, CBAAU in Pipeline 2015-03-04 11:00:28.265 GMT By Robert Elson (Bloomberg) -- Secondary IG trading ended with a Trace count of $16.6b vs $12.9b Monday, $17.9b last Tuesday. 10-DMA $16.1b. * 144a trading added $1.9b of IG volume vs $1.7b Monday, $2.1b last Tuesday * Most active issues longer than 3 ...

Unintended Consequence

Tuesday, March 3rd, 2015

Liability driven investors are the financial road kill of zero and negative rates. Via Bloomberg: Draghi's Rescue Plan Has Created a $103 Billion Problem S&P Says Sinking Bond Yields Have Worsened Pension Shortfalls Don't Miss Out — Follow us on: Facebook Twitter Instagram Youtube by Jennifer Ryan 4:39 AM EST March 3, 2015   There's a corner of the pension world ...