11:31 am - Break Out: The 5-yr is working near the best levels since mid-Mar, and gunning for more with a likely resting place near the 2.21% yield level. The fact, however, that volumes are so awful and traders remain fairly cautious, that there won't be much of a chance to get the mojo really pumping. The market isn't putting much faith in and has little hope for clear-cut results on the monetary summit, outside of setting up plans to throw more money at the problems...
11:22 am - Tacking on New Highs: Trade has pushed to the session's best levels on the 10-yr with the rest of the curve chasing along with the 5-yr hitting to the best levels on the week. The volume remains sloppy and takes some of the credibility out of the runs. Traders say the market is still feeling out the future, trying to make "heads or tails" of the stuff stuffed in that pinata full of bailout "Frankensteins," and fretting over the overall situation with supply and the dilution of treasuries' value. The
possibility that the "Frankensteins" could turn on their creators before getting chased into the woods by roving bands of unhappy, torch wielding taxpayers, er, villagers, is another issue being bandied about.
11:07 am - Running Higher : The market has picked up a nice bid this morning post-retail sales bust. Stocks are slowly erasing yesterday's gains and the G20 meeting isn't inspiring much confidence. Trade looks like it wants to be long into the weekend but volume is still on the light side so the swings are being taken with a grain of salt. The buck is chewing its way higher on the euro while the yen firms up.
10:39 am - Pushing Better: The market is plodding back through the highs, with the curve slanting steeply flatter on the 2-10-yr yield spread. Trade is still running on empty as far as size is concerned, however, so everything must be taken with a grain of salt. Stocks falling is a nice add
10:30 am - CDS Cleaned-up Soon: Bloomberg reports that at least one central clearinghouse foe credit-default swaps will be up and running by year-end. With SEC's Cox noting ``Bringing transparency to this market is vitally important...The virtually unregulated over-the-counter market in credit-default swaps has played a significant role in the credit crisis.'' Gee. Thanks.
10:22 am - Testing Higher : The continuous 10-yr futures contract is taking a run at yesterday's highs near 117-10. Volume is light but a break may bring in some fresh buyers while a failure will set up a deeper retracement of the gains off Oct lows near 111-12+. Above 117-10 eyes 118-01+.
10:08 am - Date Done: The
UofM report came in while prices were on a slight downswing, while the curve was getting a minor unwinding steepener. The 57.9 print was better than expected, but not exactly exemplary, or even good, but it won't add much to bonds. The market is backing further off the best levels on a little pop in volume, "pop" being a relative term, of course. The business inventories were off -0.2% with a revised 0.2% from 0.3%, ex-autos showeed 0.4% with manufacturers taking a hit at -0.7%
09:47 am - Cash from System : Fed drains $25B via weekend reverse repos.
09:40 am - Big Bid: The market continues to spin its way back, with the longer end leading the run and the 10-yr has taken back all of yesterday's session spanking. The stocks are sliding, helping things along while the upcoming
UofM report for Nov (big potential for leaking or early release, but should hit at 9:45-55) is expected to show the worst level since 1980, and would therefore require a pretty hard miss to the downside to boost prices much further. The 10-yr should be able to hold near the 3.735% yield level if the report does hit terribly, while the 2-yr is still nicking around the 1.550% point.
09:39 am - Dollar Chops Higher : The buck is picking up some modest ground after getting squeezed off its hilltop yesterday. Trade is proceeding with caution with some nibbling at the lows in anticipation of another swing at the trend highs below 1.24 to the euro. But volatility is keeping size on the sidelines, which increases volatility which makes for some pretty heady swings with little true directional flow to latch onto. The
market will look to fade euro gains while below 1.2860 while a push above will eyes 1.30.
Support sits near 1.2590 and 1.2440. Against the yen, the dollar has support near 96 and 95 with resistance near 97 and 98.30. The pound found support near 1.4650 as it continues to suffer aggressive rate cut speculation. Trend lows sit near 1.4555 while offers thicken up near 1.49. Spot gold is holding up at 745.98 (+9.48) while crude is off at 56.96 (-1.28).
08:58 am - Sticking Higher: The 2-yr has continued to plumb better territory, knocking the yield back off to the lowest since mid-03 after having spent some 1.155% level before making a push to 1.136% and now tracking around 1.2%. The trade continues to work under strained, wafer thin conditions, making all these swings borderline meaningless (in the big picture), although garbage for volume has become the new norm and, in a sense, the new black. The curve has been run flatter, nearing levels form the start of the week with the
2-10-yr yield spread at 245.2 while the 3-mo-10-yr is holding near the weekâs mid-range.
08:42 am - Bounce on Bad Data: The market was leaning into a bid on the way into the data, but tripped up a little once it hit, with the
retail sales dropping worse than expected at a -2.8% rate against a revised -1.3% for Sept versus -1.2%, while the
import prices -4.7% mom and -0.9% ex-oil,
exports saw a an overall -1.9% with an ex-agricultural products drop of -1.2%. The fall if in retail sales was the worst ever going back to its start in early 1992. Treasuries started back better, with the momentum of early corrective action helping things along.
mhhh
mah
