Friday, February 16, 2018

Good morning-  Global equities are all higher to start this morning for a second straight day. In Europe, the Stoxx 50 is up 39 points, the DAX is up 112 points, and the FTSE is up 58 points. In Asia, the Nikkei is up 60 points while the Hang Seng is rallying 664 points higher. US stock futures were lower before the market opened but are now all slightly positive. The DOW is up 78 points, the S&P is up 9 points, and the NASDAQ is up 6 points. Oil was flat earlier and is now trading a bit higher to $61.58. Treasury yields are 2-5bps lower across the curve in steepening fashion with the 10yr treasury dropping 5bps to 2.86%. In the credit space we saw each of the three Barclays indices close marginally tighter last night. The tone in the primary IG market remains mixed with $10bn pricing this week as issuers navigate higher rates and widening spreads. It’s worth noting that there have been five consecutive weeks of withdrawals from HY funds as $6.3bn has been yanked in the past week. In economic news, we’ll see numbers on imports/exports and uMich survey data.

Thursday, February 15, 2018

Good morning-  Global equities are all higher to start this morning. In Europe, the Stoxx 50 is up 18 points, the DAX is up 5 points, and the FTSE is up 40 points. In Asia, the Nikkei is up 70 points while the Hang Seng is up a whopping 664 points. US stock futures are all positive after a big rally yesterday. The DOW is up 178 points, the S&P is up 11 points, and the NASDAQ is up 45 points. Oil saw a surge yesterday afternoon but is slightly down today, trading at $60.21. Treasury yields are mostly flat on the front end and slightly lower on the long end. That said, the 10yr treasury is unchanged from yesterday at 2.893%. With yesterday’s selloff in treasuries, credit traded lower and issuers backed out. In economic news, we’ll see PPI, Philly Fed, Industrial production, and jobless claims.

Wednesday, February 14, 2018

Good morning-  Global equities are mostly higher to start this morning’s session. European stocks are all in the green with the Stoxx 50 up 22 points, the DAX up 90 points, and the FTSE up 54 points. In Asia, the Nikkei is down 120 points while the Hang Seng is up 38 points. US stock futures were jittery ahead of today’s highly anticipated January CPI reading which came in at 0.5%, exceeding estimates by 0.2%. Right now, the DOW is down 23 points, the S&P is up 8 points, and the NASDAQ is up 34 points. Oil is down roughly 50¢ to $58.74 putting it on pace for its worst week in 2 years as fears over rising U.S. supplies curb investor optimism. Treasury yields are higher in flattening fashion as more rate hikes are anticipated with the higher than expected CPI numbers. That said, the 10yr treasury is up about 4.5bps to 2.873%. Credit is coming under pressure as spreads continued to widen yesterday. The Barclays IG index closed at the widest since January 18 while HY backed up to +364 approaching the 2018 wide seen on Friday. In addition to CPI numbers, retail sales were weaker than expected across the board.

Thursday, February 8, 2018

Good morning-  Global equities are mixed to start this morning's session after another eventful day for stocks. In Europe, the Stoxx 50 is down 40 points, the DAX is down 152 points, and the FTSE is down 67 points. Stock futures point to a lower open in Asia after China’s yuan sank the most since the aftermath of its shock 2015 devaluation. After rallying in their last session, the Nikkei is now down 40 points and the Hang Seng is down 99 points. US stock futures erased earlier losses as the Senate is poised to quickly pass a bipartisan budget deal that would avert a government shutdown. The DOW is up 102 points, the S&P is up 13 points, and the NASDAQ is up 50 points. Oil is having another down day, trading at $61.25 which almost 4% lower for the month. Treasury yields are higher in steepening fashion with the 10yr treasury approaching 2.86%. In the credit space we saw high-grade issuers price $2.5 billion, achieving strong outcomes driven by robust investor appetite. In HY we saw the index tighten for the first time this month after 3 borrowers priced deals. In economic news, we’ll see initial jobless claims and also hear from some Fed speakers.

Wednesday, February 7, 2018

Good morning-  Global equities are mixed to start this morning after a wild day for stocks. In Europe, the Stoxx 50 is up 26 points, the DAX is up 107 points, and the FTSE is up 47 points. Stocks are ripping higher in Asia as the Nikkei up 240 points and the Hang Seng up 196 points. US equity futures point to a lower opening after the S&P saw its biggest rally since November 2016. The DOW is down 49 points, the S&P is down 7 points, and the NASDAQ is down 9 points. Oil is having another down day and is trading at $63.21. Treasury yields are roughly 2-2.5bps lower across the curve with the 10yr treasury at 2.77%. The Bloomberg Barclays IG OAS credit index backed up to +88 which is only 3bps off decade-long tights. HY has widened since the market sold off as it trades 33bps wider than it did at the end of January. In economic news, we’ll see a full docket of Fed speakers and the U.S. Treasury will conduct a $24 billion 10yr notes auction.

Thursday, November 30, 2017

Good morning-  Global equities are mostly higher to start this morning’s session as Senate Republicans look to approve their tax-overhaul legislation as soon as tonight.  In Europe, the Stoxx 50 up 11 points and the DAX up 73 points while the FTSE is down 11.5 points. In Asia, the Nikkei is up 60 points and the Hang Seng is up 77 points. Stock futures in the US are all positive after the Nasdaq 100 had its worst drop in three months . That said, the DOW is up 93 points, the S&P up 8.5 points, and the NASDAQ is up 23 points. Oil is up almost 50 cents to $57.76/bbl following OPEC’s largest producers signaling they would extend their oil production cuts until the end of next year. Treasury yields are little changed with the yield on the 10yr UST at 2.392%. In the credit space, we saw Alibaba price $7bn in a 5-part bond deal which launched inside the curve but behind Amazon. Today’s economic data includes weekly jobless claims, personal income and spending, and several PCE numbers.

Wednesday, November 29, 2017

Good morning-  Global equities are mostly higher to start this morning’s session as optimism over U.S. tax reform and euro-area economic growth overshadows North Korea concerns. In Europe, the Stoxx 50 up 25 points and the DAX up 101.5 points while the FTSE is down 50 points. Asian stocks are mixed as the Nikkei is up 110 points while the Hang Seng is down 35 points. Stock futures in the US are all positive as senators begin debating the GOP tax bill. The DOW is up 74 points, the S&P up 2.5 points, and the NASDAQ is up 2 points. Oil is down to $57.79/bbl ahead of tomorrow’s OPEC meeting in Vienna. With respect to rates, treasury yields are 1.5-5bps higher across the curve in steepening fashion. The yield on the 10yr UST is up  4bps to 2.369%. In other news, U.K. and EU negotiators reached an outline deal on the Brexit divorce bill and Bitcoin is surging toward $11,000. Today’s economic data includes Pending Home Sales and the Fed’s Beige Book.

Tuesday, November 21, 2017

Good morning-  Global equities are all in the green to start this morning’s session. Automakers and insurance companies are pushing European markets higher with the Stoxx 50 up 23 points, the DAX up 112 points, and the FTSE up 20.5 points. In Asia, the Nikkei is up 170 points while the Hang Seng is up a whopping 282 points. Stock futures in the US are all positive as the dollar slips and bonds rise. The DOW is up 100 points, the S&P up 8.75 points, and the NASDAQ is up 29 points. Oil is almost unchanged at $56.44/bbl. With respect to rates, the yield curve continues to flatten with 2y/10y below 60bps. The yield on the 10yr UST is down roughly 1.5 bps  to 2.356%. Aside from existing home sales, there is no economic data scheduled for today.

Tuesday, November 14, 2017

Good morning- Global equities are mostly lower to start this morning’s session. In Europe, the Stoxx 50 is down 18 points and the DAX is down 47 points while the FTSE is up 5 points. In Asia, the Nikkei is down 30 points and the Hang Seng is down 23 points. Stock futures in the US point to a lower open as the GOP creeps forward in passing tax reform. That said, the DOW is down 42 points, the S&P down 5.5 points, and the NASDAQ is down 7.25 points. Oil is down to $56.45/bbl. With respect to rates, treasury yields are dropping in flattening fashion. The yield on the 10yr UST is down a little over a basis point  to 2.395%. High yield continues to struggle as we saw another HY issuer (Resolute Energy) back out of an announced deal. Aside from PPI, there is no significant economic data scheduled for today.

Friday, November 10, 2017

Good morning- Global equities are all lower to start this morning’s session. In Europe, the Stoxx 50 is down 13 points, the FTSE is down 38 points, and the DAX is down 22 points. In Asia, the Nikkei is down 90 points and the Hang Seng is down 19 points. Stock futures in the US point to a lower open as the House and Senate both scramble to put a tax bill together. That said, the DOW is down 31 points, the S&P down 6.75 points, and the NASDAQ is down 11.5 points. Oil is mostly unchanged as it sits just above $57/bbl. With respect to rates, treasury yields are up 1-4bps across the curve in steepening fashion. The yield on the 10yr UST is up about 3bps to 2.37%. Credit continues to struggle this week with high yield getting hit the hardest. The Bloomberg Barclays HY OAS index has widened out 24bps this week representing the largest weekly drop since early March. There is no significant economic data scheduled for today.

Friday, October 20, 2017

Good morning- Global equities are higher to start this morning’s session after a very weak opening yesterday. In Europe, the Stoxx 50 is up 7 points, the FTSE up 16.5 points, and the DAX is up 27 points. In Asia, the Nikkei is up 30 points and the Hang Seng up 15 points. US stock futures point to a higher open after the tax reform bill passed in the Senate. That said, the DOW is 79 points, the S&P up 5.5 points, and the NASDAQ is up 10.75 points. The dollar is stronger and oil has fallen below $51/bbl, extending its recent decline. With respect to rates, Treasury yields are 3.5-5.5bps higher across the curve with the yield on the 10yr UST climbing to 2.37%. It is worth noting that Powell and Taylor have emerged as favorites for the Fed Chair. In addition to hearing earnings from Procter & Gamble and Schlumberger, we will see data on existing home sales.

Wednesday, October 18, 2017

Good morning- Global equities are significantly higher to start this morning’s session. In Europe, the Stoxx 50 is up 9 points, the FTSE up 9.5 points, and the DAX is up 37 points. In Asia, the Nikkei is up 60 points and the Hang Seng up 33 points. Right now the Dow futures are up almost 80 points which would be a record-high open. Meanwhile, the S&P is up 3.5 points and the NASDAQ is up 3 points. Oil is continuing its rally and is trading through $52/bbl while the VIX threatens to dip below 10. With respect to rates, Treasury yields are 1.5-3bps higher across the curve in steepening fashion. That said, the yield on the 10yr UST is up to 2.33% after failing to dip below that 2.3% level yesterday. In the IG space, Goldman is set to price today after $8.15bn priced yesterday from six issuers. In addition to hearing earnings from American Express and Abbot Laboratories, the Fed Beige book will be released this afternoon.  

Tuesday, October 17, 2017

Good morning- Global equities are mixed to start this morning’s session. European stock futures are all higher with the Stoxx 50 up 4 points, the FTSE up 15.5 points, and the DAX down 3 points. Asian stocks are lower with the Nikkei down 20 points and the Hang Seng up 1 point. US equities are mixed as traders assess the most recent earnings reports from the six major banks. Right now, the DOW is up 20 points and the S&P and NASDAQ are unchanged. Oil is trading through $52/bbl as a golden cross is beginning to form. With respect to rates, the yield on the US 10 yr is just above 2.3% after dipping below that key level yesterday. So far we have only seen $2 bn price from 2 issuers. Nevertheless, credit indexes remain at tights with the Bloomberg Barclays IG Corporate Bond Index reaching its tightest level since 2014. In economic news, we will see data from import/export indexes and the industrial production numbers.

Thursday, October 12, 2017

Good morning- Global equities are mixed to start this morning’s session. In Europe, the Stoxx 50 is down 10 points, the FTSE up 35.5 points, and the DAX is down 11 points. Asian stocks are also mixed with the Nikkei up 20 points and the Hang Seng down 17 points. US equity futures are pointing to a slightly weaker open before JPMorgan and Citigroup kick off U.S. bank earnings announcements. The DOW is down 23 points, S&P down 4.75 points, and the NASDAQ is down 6 points. Oil is hovering just above $50/bbl while gold and the VIX are trading higher. The yield on the US 10 year is back above 2.34% after dipping below 2.32% yesterday. In the IG space, we saw $15.75bn price from 6 issuers which brings YTD volume to $1.368t. Of that $15.75bn that priced yesterday, $6bn was from Wal-Mart.  Today’s economic data includes PPI and weekly jobless in addition to speeches from the ECB’s Draghi and the Fed’s Powell and Brainard.

Wednesday, October 11, 2017

Good morning- Global equities are mostly negative to start this morning’s session. In Europe, the Stoxx 50 is down 1 point, the FTSE down 4.5 points, and the DAX is down 3 points. Asian stocks are also lower with the Nikkei is down 10 points and the Hang Seng is down 54 points. US equity futures are pointing to a slightly weaker open while the VIX flirts with falling below 10. The DOW is down 1 point, S&P down 1.5 points, and the NASDAQ is down 5 points. Oil traded through $51/bbl after OPEC announced that it projects strong demand in 2018. UST yields dropped 0.5-1.5bps across the curve while both IG and HY credit indices continue to trade at multi-year tights. In the IG space, we saw $13.8b price from 5 issuers which brings YTD volume to $1.35t. Today we will hear from Fed’s Evans and Williams.

Wednesday, October 4, 2017

Good morning- Global equities are mostly lower to start the session. European stocks are all down with the exception of the DAX, which is up 18.5 points. Right now the Stoxx 50 is down 20 points and FTSE is down 4.5 points. In Asia, the Nikkei is down 20 points while the Hang Seng is down 22 points. US equity futures are pointing to a weaker open with the DOW down 14 points, S&P down 2 points, and the NASDAQ down 8.25 points. The dollar fell and treasury yields are down 1-2bps across the curve as President Trump’s shortlist for Fed Chair leans dovish. The yield on the US 10 yr is now at 2.309% as IG credit continues to grind tighter to levels not seen since July of 2014. Aside from September’s reading of the ADP Employment Change index, there is no significant economic data scheduled for today.

 

Tuesday, October 3, 2017

Good morning- Global equities are mostly higher for a second straight day. Excluding Spain, European stocks are up with the Euro Stoxx 50 up 3 points, FTSE up 19 points, and the DAX unchanged. In Asia, the Nikkei is unchanged while the Hang Seng is up 12 points. US equity futures are pointing to new record highs with the DOW up 31 points, S&P up 2 points, and the NASDAQ up 7.5 points. Treasury yields are 0.5-2bps higher across the curve in steepening fashion as the yield on the US 10 yr has backed up to 2.359%. Yesterday we saw $5bn price across 7 issuers. Both the Bloomberg Barclays IG and HY indices continue to grind to multi-year tights. There is no significant economic data scheduled for today.

In other news, the White House is said to have ruled out talks with North Korea despite Tillerson saying the U.S. was talking to North Korea “directly, through our own channels.” In the muni market, top-rated bonds finished mixed on Monday as traders wait for the NY TBTA and King County Washington deals to price.  

Monday, October 2, 2017

Good morning- Global equities are mostly higher as we kick off the first trading day of the fourth quarter. European stocks are up with the exception of Spain, who is dealing with a Catalonian push for independence. Spain’s benchmark bonds fell to the lowest levels in almost 3 months as more than 800 people have been injured. Nevertheless, the Euro Stoxx 50 is up 6 points, FTSE up 44.5 points, and the DAX is up 52 points. In Asia, the Nikkei is down 30 points while the Hang Seng is up 51 points. US equity indices are also higher in spite of the deadliest mass shooting in US history. The DOW is up 26 points, S&P up 2.25 points, and the NASDAQ up 7 points. The yield on the US 10 yr is up about half a basis point to 2.323% as the Bloomberg Barclays IG index closed at the tightest level in more than 3 years on Friday. This morning we’re also seeing commodities trade lower as WTI is now below $51/bbl and gold is trading down for the 4th time in the last 6 sessions.

Friday, September 29, 2017

Good morning- Global equities are mixed to start the final trading day of the third quarter. European stocks are mostly higher with the Euro Stoxx 50 up 11 points, FTSE up 46.5 points, and the DAX up 51 points. Asian stocks are slightly lower with the Nikkei down 20 points and the Hang Seng down 9 points. In the US, the DOW is down 12 points, S&P down 1.25 points, and the NASDAQ up 7.75 points. The yield on the US 10 yr is down to 2.305% as the Bloomberg Barclays IG index continues to grind tighter. Additionally, oil has settled down to $51.56/bbl after climbing to $53 yesterday. In other news, Deutsche Bank had its long-term credit rating cut one notch by Fitch yesterday. Other than that, there is no significant economic news or primary/municipal issuance scheduled for today.

Thursday, September 28, 2017

Good morning- Global equities are mixed to start this morning’s session. In Europe, the Euro Stoxx 50 is up 3 points, FTSE down 12 points, and DAX up 36.5 points. Asian stocks are mostly negative with the Nikkei down 60 points and the Hang Seng down 97 points. US equities are all lower after touching an all-time high yesterday. The DOW is down 30 points, S&P down 3.25 points, and the NASDAQ down 14.75 points. The yield on the US 10 yr is up to 2.334% as market participants assess President Trump’s tax plan. The Bloomberg Barclays IG and HY indices closed tighter on Wednesday as the curve continue to steepen. Moreover, oil is on its way to $53/bbl after a surprising drop in crude inventories. In economic news, we will hear from several Fed speakers and see the numbers on weekly jobless claims.

Things are starting to get interesting in the muni market. Fortunately, the tax-exempt status of muni bonds is not in jeopardy under Republican’s plan for tax reform, however, the federal deduction for state and local taxes would be repealed. The plan would also eliminate the alternative minimum tax (AMT) which the majority of private-activity bonds are subject to. With respect to Puerto Rico, Trump waived the Jones Act in order to facilitate relief efforts on the island. The Jones Act requires shipments of goods between two U.S. ports to be made with American-flagged vessels which limits the amount of shipping and makes imports significantly more expensive for the island.