US TSYS: Late Stock Retreat, Join Treasuries, Focus on Earnings, Bobs
May-01 20:09
- US Treasuries are broadly weaker after the bell (late stock retreat to only mildly higher after Amazon, Eli Lilly & Becton Dickinson sell off), near late session lows as focus turns to Friday morning's April employment report. Volatile early trade as markets reacted more to economic data than trade related headlines.
- Treasuries extended early highs after higher than expected weekly and continuing claims, prior for continuing down-revised. Initial jobless claims increased to 241k (sa, cons 223k) in the week to Apr 26 after a marginally upward revised 223k (initial 222k).
- Rates reversed course, extended lows while stocks rallied - caveats to higher than expected ISM New Orders & Employment data as markets apparently overlooked (very weak report that is consistent with recessionary conditions in the manufacturing sector amid policy uncertainty and a giveback of tariff-front loading production in Q1.)
- Tsy Jun'25 10Y currently 9.5 at 111-29.5 vs. 111-24.5 low (10Y yld climbs to 4.2388% high), technical support well below at 111-07.5 (20-day EMA).
- US$ gained (BBDXY +6.09 at 1229.69) , while Gold sold off sharply (-60.63 at 3228.08). Note: Stocks pared gains into the close, finishing mildly higher: SPX eminis +22. at 5609.25.
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USDCAD TECHS: Slips Sharply Off Overnight High
Apr-01 20:00
- RES 4: 1.4700 Round number resistance
- RES 3: 1.4641 76.4% retracement of the Feb 3 - 14 bear leg
- RES 2: 1.4452/4543 High Mar 13 / 4 and a bull trigger
- RES 1: 1.4415 Intraday high
- PRICE: 1.4313 @ 16:08 BST Apr 1
- SUP 1: 1.4309 Low Apr 01 and a key support
- SUP 2: 1.4151 Low Feb 14
- SUP 3: 1.4107 50.0% retracement of Sep 25 ‘24 - Feb 3 bull run
- SUP 4: 1.4011 Low Dec 5 ‘24
USDCAD traded sharply lower into the close, erasing much of the week’s early gains. This puts prices through the 50-day EMA support and makes for a 100 pip drop off the intraday high. A return lower and clearance of 1.4235, the Mar 26 low, would undermine the bull theme and highlight potential for a test of 1.4151, the Feb 14 low and a bear trigger. Moving average studies, however, continue to highlight a dominant uptrend - and a stronger rally would refocus attention on the bull trigger at 1.4543, the Mar 4 high.
US DATA: Chicago Fed CARTS Estimates Ex-Auto Retail Sales Pickup In March
Apr-01 19:46
The Chicago Fed's preliminary CARTS (Chicago Fed Advance Retail Trade Summary) report out today estimates a pickup in US ex-auto retail and food services sales in March to 0.7% M/M SA, from 0.3% prior.
- This comes despite a 0.4% W/W decline in the last week of March, following on from a 0.6% decline the prior week - given a very strong opening to the month (the 2nd week saw sales rise 1.1%). These figures roughly collaborate the trajectory seen in in March's Johnson Redbook retail data.
- This is scheduled to be updated a day before the March Census Bureau retail sales releast (on Apr 16). Per the Chicago Fed, "The index summarizes weekly data on retail transactions & foot traffic, gasoline sales, and consumer sentiment, and is used to project current monthly retail & food services sales ex. auto."
- While most indicators of retail sales so far look solid in March, we take this release with some skepticism: CARTS missed the mark badly in February, estimating an 0.8% M/M decline in ex-auto retail sales, vs the +0.3% actual reading (which was in line with consensus).
US TSYS: Rates Bid/Off Highs Ahead Midweek Tariff Announcement
Apr-01 19:37
- Treasury futures are holding decent gains after the bell, off mid-morning highs as accounts square positions ahead of Wednesday afternoon's reciprocal tariff announcement from the White House (1600ET est).
- Washington Post reports that "White House aides have drafted a proposal to impose tariffs of around 20 percent on at least most imports to the United States, three people familiar with the matter said".
- Early FI support after mildly higher than expected S&P Mfg PMI data, lower than expected JOLTS job openings, quits and layoffs higher than expected. ISMs mixed with Mfg, new orders and employment lower than expected while prices paid jumped.
- Tsy Jun'25 10Y contract trades 111-23.5 (+16.5), off earlier high of 111-30.5, just shy of technical resistance at 112-01 (High Mar 4 and a bull trigger). Curves bull flattened off early week highs: 2s10s -2.766 at 29.033, 5s30s -1.289 at 60.651.
- Cross asset update, Bbg US$ index -0.88 at 1273.42, Gold retreats to 3117.09 (-6.50) after making new highs around 3148.0, crude retreating (WTI -.23 at 71.25.).
- Aside from tomorrow's tariff announcement, midweek data includes ADP Employment Change at 0815ET, Factory & Durable goods Orders at 1000ET, while Fed Gov Kugler speaks on inflation expectations (text, Q&A) at 1630ET.
