MARKET INSIGHT: What to Watch: Fed Barkin, Import/Export Data, UofM Sentiment
Aug-12 11:47
Tsys paring back modest gains on modest volumes (TYU2<275k) ahead the NY open, relative calm ahead next round of data at 0830ET (prior, est):
- Import Price Index MoM (0.2%, -1.0%); YoY (10.7%, 9.4%)
- Import Price Index ex Petroleum MoM (-0.4%, -0.1%)
- Export Price Index MoM (0.7%, -1.0%); YoY (18.2%, --)
- Followed by UofM Sentiment at 1000ET:
- U. of Mich. Sentiment (51.5, 52.5)
- U. of Mich. Current Conditions (58.1, 57.9)
- U. of Mich. Expectations (47.3, 48.5
- U. of Mich. 1 Yr Inflation (5.2%, 5.1%)
- Scheduled Fed speakers rather limited so far: Richmond Fed Barkin CNBC interview at 1000ET
- Treasury auctions resume next week:
- $15B 20Y Bond (912810TK4) on Wednesday
- $8B 30Y TIPS reopen (912810TE8) next Thursday.
- US Politics from Punchbowl News: Rep. Mike Turner (R-Ohio), the top Republican on the House Intelligence Committee, and some of his fellow committee members will hold a news conference on the FBI raid of Mar-A-Lago. 0900ET
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ISRAEL: No Bloc Set For Majority According To Latest Polling
Jul-13 11:46
Latest general election opinion polling from Midgam shows neither the pro- nor anti-Benjamin Netanyahu blocs on course to win a stable majority in the Knesset in the upcoming 1 November election. However, polls do show Netanyahu as the more favoured PM ahead of incumbent caretaker PM Yair Lapid or Defence Minister Benny Gantz.
- Midgam seat projection: Likud: 34 (-1), Yesh Atid: 23 (+3), Blue & White/New Hope: 13, Religious Zionism: 10 (+1), Shas: 8, United Torah Judaism: 7, Yisrael Beiteinu: 6 (+1), Joint List: 6, Labor: 5, Meretz: 4, Ra'am: 4. +/- vs. 21 June 2022. Fieldwork: 11 July 2022. Sample size: 506
- Based on this poll, Netanyahu's bloc (Likud, Shas, UTJ, RZ) would hold 59 seats, just short of the 61 required for a majority. The Arab-interest Joint List often acts as a 'spoiler' given that it is not inclined to work with either the pro- or anti-Netanyahu blocs.
- In another poll of head-to-head matchups on who respondents view as best suited to be PM Netanyahu comes out as the most favoured candidate, although without a majority in any scenario. Kantar poll for Channel 11, 11 July, 565 respondents:
- Netanyahu (Likud, Conservative): 45% Lapid (YA, Liberal): 36% Neither: 19%
- Netanyahu (Likud, Conservative): 45% Gantz (B&W, Centrist): 28% Neither: 27%
- Lapid (YA, Liberal): 26% Gantz (B&W, Centrist): 26% Neither: 48%
OPTIONS: Larger FX Option Pipeline
Jul-13 11:14
- EUR/USD: Jul14 $1.0190-00(E1.0bln); Jul15 $1.0200(E1.1bln)
- USD/JPY: Jul14 Y135.70($1.1bln), Y139.00($1.5bln)
- AUD/USD: Jul15 $0.6900($1.0bln)
- NZD/USD: Jul14 $0.6120(A$1.3bln)
- USD/CAD: Jul15 C$1.3000($1.1bln)
- USD/CNY: Jul15 Cny6.6500($1.8bln)
US EURODLR FUTURES: Post-LIBOR Settle Update: Ignoring New 3M High
Jul-13 11:07
Lead quarterly EDU2 trades steady to +0.005 at 96.685 after latest 3M LIBOR set' new 3Y high of 2.51200% +0.02900 (+0.08900/wk).
- Forward Fed hike expectations steady after moderating slightly since last Fri's strong jobs data, balance of Whites through Golds (EDZ2-EDM7) +0.025-0.015. Markets await this morning June CPI read for direction.
- Front end inversion at recent lows: Dec'22/Mar'23 at -0.130. Most inverted calendar spds: EDZ2/EDZ3 at -0.635, EDH3/EDH4 at -0.620. Inversion starts to flatten out in latter half of Greens w/ EDH5/EDM5 trading flat (97.220).
- Second consecutive session of limited option volume Tuesday, flow mildly bullish with put unwinds and call buys with underlying futures trading higher, 30YY falling to 3.0833% low before climbing back to 3.1240% after the bell.
- Highlight Eurodollar trade includes put skew sale with 5,000 Dec 96.00 puts 6.0 over 96.25/96.75 call spreads. Midcurve call buyer paid 40.5 for 5,000 Green Dec 97.25 calls vs. 97.185/0.45%.
- Limited SOFR trade had paper buying 7,000 SFRZ2 96.50/97.00/98.00 broken call flys.
