Traders Market Weekly: Big Three Central Banks Resolve to be Tested.

January 29 – Feb 4, 2023 FEAR NOT Brave Investors Where have we been and where are we going? Join our weekly market thread on Traders Community… The Week That Was – What Lies Ahead? Contents Click on the links below to navigate to the relevant section. Editorial The rally that started last Friday continued all week until a sharp pullback ahead of this Friday’s close. A rational sign given the data, banker and earnings deluge next week. We have … Continue reading “Traders Market Weekly: Big Three Central Banks Resolve to be Tested.”

Bond Traders Weekly Outlook: US Treasury Auctions Outperform Ahead of FOMC

U.S. Treasuries pulled back for the second consecutive day on Friday, resulting in a mixed finish for the week. Inflation watchers saw a milder PCE as expected while Japan’s Tokyo Core CPI rose 4.4% yr/yr in January it was back on topic. The 10-yr note yield settled the week at 3.52%. The 2-yr note yield, which is most sensitive to changes in the Fed funds rate, settled at 4.21%. U.S. Treasuries completed this week’s spectacular note auctions with the $35 bln 7-yr … Continue reading “Bond Traders Weekly Outlook: US Treasury Auctions Outperform Ahead of FOMC”

Strong U.S. 7-year Treasury Bond Auction with International Buyers Highest Since May

U.S. Treasuries completed this week’s spectacular note auctions with the $35 bln 7-yr note high yield of 3.517%, which stopped through the when-issued yield by 2.1 bps. The bid-to-cover ratio (2.69x) well above average (2.48x) while indirect takedown (international buyers) at 77.1%, the highest level since May. This followed yesterday’s 5-year sale which also stopped through strongly. We are seeing a continuation of foreign buyers of US Treasuries stepping up purchases after JGB volatility and uncertainty in Europe with Russia. The … Continue reading “Strong U.S. 7-year Treasury Bond Auction with International Buyers Highest Since May”

Traders Market Weekly: Big Tech Earnings and Global PMI

January 22 – 28 2023 FEAR NOT Brave Investors Where have we been and where are we going? Join our weekly market thread on Traders Community… The Week That Was – What Lies Ahead? Contents Click on the links below to navigate to the relevant section. Editorial This week came under some heavy selling pressure which dissipated by Friday lunch as the put wall was crushed with VIX imploding. Initially, as with a tamer CPI last week we saw inflationary … Continue reading “Traders Market Weekly: Big Tech Earnings and Global PMI”

Bond Traders Weekly Outlook: U.S. Treasuries Backed Off September Highs on Optimistic Chatter

U.S. Treasuries continued the move from last week through Wednesday giving back most of those gains Friday resulting in a slightly higher finish for the week in most tenors. The long bond ended negative territory for the week while the 10-yr note and shorter tenors gave back most of their gains from Wednesday’s surge that sent yields on these tenors to levels not seen since September. Together with hopeful rhetoric Treasuries and European debt faced pressure at the end of … Continue reading “Bond Traders Weekly Outlook: U.S. Treasuries Backed Off September Highs on Optimistic Chatter”

Strong Demand at U.S. 20-year Treasury Bond Auction Follows Last Week’s Series

U.S. Treasuries traded firmly with the belly of the curve continuing today’s outperformance pressuring yields toward their lowest levels of the day. Earlier we had a lower-than-expected PPI for December. The completion of today’s $12 bln 20-yr Treasury bond reopening, followed the path of last week’s auctions meeting excellent demand.  The high yield 3.678%, which stopped through the when-issued yield by 2.7 bps while the bid-to-cover ratio (2.83x) and indirect takedown (76.3%) were comfortably above average. The desk gave a … Continue reading “Strong Demand at U.S. 20-year Treasury Bond Auction Follows Last Week’s Series”

Traders Market Weekly: Short Squeezes and Bond Markets

January 15 – 22 2023 FEAR NOT Brave Investors Where have we been and where are we going? Join our weekly market thread on Traders Community… The Week That Was – What Lies Ahead? Contents Click on the links below to navigate to the relevant section. Editorial It has been a confusing two weeks of 2023 for those calling the end of the world. In the first nine trading sessions of the year, the S&P500 gained 4.20%, The small cap … Continue reading “Traders Market Weekly: Short Squeezes and Bond Markets”

Bond Traders Weekly Outlook: US Completes Three Strong Auctions with Spectacular International Demand

U.S. Treasuries closed out the week on a lower note, after two days of strong gains around the December CPI report. Fed Chair Powell’s speech at the Riksbank International Symposium offered no anguish and a strong University of Michigan’s consumer sentiment report finished the week. The four-week bill yield jumped nearly 25 bps to 4.45% amid growing focus on the upcoming debt ceiling debate. The week saw three extremely strong auctions. $18 bln 30-yr bond reopening, $32 bln 10-yr note reopening, … Continue reading “Bond Traders Weekly Outlook: US Completes Three Strong Auctions with Spectacular International Demand”

Record Foreign Demand at US Treasury Bond Reopening Completes Strong Auction Week

U.S. Treasuries were led higher by the long bond building on its gain after the completion of this week’s third extremely strong auction. The desk gave an A- rating on the auction. Today’s $18 bln 30-yr bond reopening stopped through by 2.4 bps and benefited from record foreign demand with Japanese investors looking outward after the BoJ shift. It followed these week’s $32 bln 10-yr note reopening, which met excellent demand and the impressive 3-yr note sale. Today’s sale followed the … Continue reading “Record Foreign Demand at US Treasury Bond Reopening Completes Strong Auction Week”

Solid International Demand in 10-year U.S. Treasury Bond Auction Ahead of CPI

US Treasuries rallied Wednesday with most tenors picking up after the completion of today’s $32 bln 10-yr note reopening, which met excellent demand.  The auction drew a high yield of 3.575%, which tailed the when-issued yield by 0.5 bps. The bid-to-cover ratio (2.53x) and indirect takedown (67.0%) were well above average.  Today’s auction followed yesterday’s impressive 3-yr note sale. The market is showing minimal concern ahead of tomorrow’s release of the US CPI report for December.  Another factor was the U.S. … Continue reading “Solid International Demand in 10-year U.S. Treasury Bond Auction Ahead of CPI”