What to Watch: Existing Home Sales, Fed Speak, Bank of Japan?
Apr-20 12:13
Rates rebounding after Tue's rout that saw 30YY climb to 3-year high of 3.016% in late trade -- climbing to 3.0285% in early Asia hours before the Bank of Japan offered to conduct an unlimited purchase of Japanese Government Bonds (JGBs). That put the brakes on surge in yields with Bunds and Tsys rebounding. 30YY currently 2.9304%.
- Data on tap at 1000ET:
- Existing Home Sales (6.02M, 5.78M); MoM (-7.2%, -4.0%)
- U.S. Federal Reserve Releases Beige Book at 1400ET
- Scheduled Fed speakers:
- SF Fed Daly economic/policy outlook, media Q&A at 1030ET
- Chicago Fed Evans economic/policy outlook, no text, Q&A, 1130ET
- Atlanta Fed Bostic, urban development, no text, Q&A 1300ET
- Stocks gaining (ESM2 +17.5 at 4476.75) extend late overnight high as earnings cycle gains momentum (not to mention over 50-day EMA technical support). Of several that have annc'd this morning - most beating est's. Notable: Proctor Gamble (PG) and Abbot (ABT). After the close: AA, UAL, TSLA to name a few.
- Geopol risk: Alert for developments on Russia war in Ukraine, knock-on effect to markets. Latest has UK announcing plans to impose further sanctions on Russia this week.
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What to Watch: Geopolitical Headline Risk
Mar-21 12:12
US FI markets weaker, near lows on low volume start to the week with Japan out for Vernal Equinox Day holiday, TYM2 just over 235k at the moment.
- Equities steady, near middle of overnight range and eying weaker Boeing shares after 737 crash in Guangxi province.
- Keeping wary eye on Russia/Ukraine headlines, knock-on risk:
- Crude climbing (WTI +3.8 at 108.50) after "Russian Deputy PM Alexander Novak alleging that 'oil prices may rise to USD300/bbl if Russian oil is shunned, but that is unlikely", TASS.
- Spokesman for Germany's Chancellor says Germany cannot do without Russian oil, Bbg
- Limited morning data summary, coming up at 0830ET (prior, est):
- Treasury auctions $57B 13W, $48B 26W bills at 1130ET
- Chicago Fed Nat Activity Index (0.69, 0.54)
- Fed speakers:
- Atlanta Fed Bostic at NABE Conf, text and Q&A at 0800ET
- Fed Chairman Powell at NABE Conf, text, moderated Q&A at 1200ET
- Pres Biden will travel to Brussels, Belgium on Wednesday next week, expected to speak at European council summit on Thursday, followed by G7 meeting. No set times, TBA.
LIBOR: JAPAN FIX - 21/03/22
Mar-21 12:03
- JY0001M -0.06375 0.00000
- JY0003M -0.00821 0.00000
- JY0006M 0.04267 0.00000
US EURODLR FUTURES: Post-LIBOR Settle Update, New 3M High
Mar-21 12:02
Lead quarterly EDM2 holding near overnight lows at 98.525 (-0.030) after latest 3M LIBOR settle climbs +0.02357 to 0.95757% -- highest level since mid-April, 2020 after climbing +0.10800 total last wk.
- Balance of Whites (EDU2-EDH3) trade -0.050-0.070, while Reds through Golds (EDM3-EDH7) trading -0.050-0.070 lower, Greens and Blues (EDM4-EDH6) underperforming.
- Uncertainty over pricing in forward policy: longer expirys continue to outperform w/ first price inversion still between Red Sep'23 (97.180) and Red Dec'23 (97.235). Inversion extends through Greens (EDM4-EDH5) while latter half of Blues-start of Golds trade flat around 99.725.
- Eurodollar option roundup: Friday saw pick-up in put buying on the day after hawkish policy comments from Fed Gov Waller, StL Fed Bullard and Richmond Fed Barkin weighed on Eurodollar Whites. Highlight trade/Blocks
- +20,000 Sep'22 97.62/98.00 put spds, 12.5 vs.
- -10,000 Dec'22 97.75/98.00 put spds, 14.0 vs.
- -10,000 Mar'23 97.50/97.75 put spds, 14.0
- Block, 14,000 Dec 99.25/99.37 put spds, 0.5 vs. 97.635/0.05%
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