FED: Powell Press Conference Transcript
Dec-18 20:28
A rough transcript of the post-FOMC meeting press conference with Chair Powell at the link below:
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US TSYS: Late SOFR/Treasury Option Roundup: Unwinds & Vol Sales
Nov-18 20:26
Option desks reported mixed SOFR & Treasury options Monday: a fair amount of position unwinds and vol sales (TYF5 109.5/110 strangles). Off morning lows, underlying futures are making modest gains in short to intermediate durations, bonds underperforming. Projected rate cuts into early 2025 look largely steady vs. early Monday levels (*) : Dec'24 cumulative -14.6bp (-14.6bp), Jan'25 -22.6bp (-22.6bp), Mar'25 -37.2bp (-37bp), May'25 -45.4bp (-44.2bp).
- SOFR Options:
- -5,000 SFRM5 95.25/96.00 2x1 put spds, 20.0 vs. 95.975/0.28%
- -11,000 SFRZ4 95.50/95.68 call spds w/ SFRZ4 95.56/95.68 call spd strip, 10.75
- -4,000 SFRH5 95.81 straddles vs. SFRH5 96.06 calls, 26.0 95.775
- -3,000 SFRF5 95.75/96.12/96.50 Iron Fly 25.25 ref 95.775
- +2,500 SFRJ5 96.00/96.50 1x2 call spds, 3.5 ref 95.96
- +4,000 SFRZ5 95.75/96.50 strangle vs SFRM6 95.50 put, 27.0 net ref 96.155/0.30%
- +2,500 SFRZ4 95.50/95.62 call spds 6.25 ref 95.545
- +2,500 SFRM5 95.50/95.62/95.87 put trees, 2.0 ref 95.96
- +12,000 SFRZ4 95.56/95.62/95.68 call flys, 1.75 ref 95.547
- 11,000 SFRZ4 95.50 puts ref 95.547
- over 18,500 SFRZ4 95.50 calls
- over 28,000 SFRZ4 95.62 calls
- Block, -10,000 SFRH5 95.37/95.50/95.62 put trees, 1.0 net ref 95.785
- 10,000 SFRF5 95.37/95.50/95.63 put trees ref 95.785
- Block, 3,500 3QG5 95.75/95.87 put spds, 3.0 ref 96.18/0.07%
- Treasury Options:
- -17,000 TYF5 109.5/110 strangles, 139
- 2,000 TYZ4 109.5 straddles, 39
- over 9,500 TYZ4 111 calls, 1
- -5,500 TYZ4 109.5 puts vs. TYF5 107 puts, 7 net bear curve steepener
- 2,800 TYZ 109/109.5 strangle vs. TYF5 108.5/109.5 strangles
- 2,300 FVZ4 106 puts vs. 106.5/107.25 call spds ref 106-13.25
- over 6,900 TYZ4 108.5 puts, 3-4 ref 109-10
CANADA: TD In Line With Consensus For CPI, See Supporting Second 50bp Cut
Nov-18 20:21
- TD Securities expect headline CPI to have firmed 0.3ppts to 1.9% Y/Y in October “as prices rise by 0.3% m/m, unwinding most of the drop from last month.”
- “A smaller drag from energy products provides the main catalyst for the rebound, while further progress on shelter inflation should drive a modest deceleration across the ex. energy aggregate.”
- “Core inflation measures are expected to edge higher to 2.40% y/y in October [after 2.35% in September], or 2.2% on a 3m annualized basis. If realized, our forecast would leave Q4 CPI tracking below BoC projections after a similar miss for the Bank's inflation forecast in Q3.”
- “Even with core inflation measures showing more resilience into Q4, we believe recent inflation progress will add to the Bank's urgency to bring policy to a more neutral stance with another 50bp cut in December.”
US STOCKS: Late Equities Roundup: Transportation, Pharmaceuticals Weighing
Nov-18 19:57
- Close to prior levels in late Monday trade, stocks remain mixed with S&P EMINIS and Nasdaq outperforming modestly lower DJIA prices. Currently, the DJIA trades down 53.26 points (-0.12%) at 43392.89, S&P E-Minis up 22.75 points (0.39%) at 5919.75, Nasdaq up 116.6 points (0.6%) at 18797.16.
- Industrials and Health Care sectors underperformed in the second half, as the former displaced the Financial sector shares. Transportation and shipping stocks led laggers: Uber -6.33% reportedly tied to talk president elect Trump will curtail autonomous driving restrictions. Meanwhile, Delta trades -1.17%, Southwest -1.07%, United Air -0.70%.
- Pharmaceutical stocks continued to weigh on the Health Care sector, carry-over weakness after President elect Trump's choice of RF Kennedy Jr to head the Dept of Health & Human Services was announced last week: Eli Lilly -3.88%, West Pharmaceuticals -2.72%, Thermo Fisher -2.60%.
- Conversely, Energy and Communication Services sectors outperformed late Monday, oil and gas shares bid on the back of higher crude prices (WTI +2.12 at 69.14): Diamondback Energy +3.06%, ONEOK +2.23%, Valero +2.24%.
- Interactive media and entertainment shares continued to buoy the Communication Services sector: Netflix +2.49%, Take Two Interactive +2.39%, Warner Bros +2.22% after resolving a dispute with the NBA and agreeing to a lucrative 11 year contract.
- Big names still to report earnings this week include: Jacobs Solutions, Lowe's, Walmart, Target, Williams-Sonoma, TJX, Nvidia, Palo Alto Networks, Intuit, Copart and the Gap.
