UST MORNING CALL: Lack of Data Leaves Focus on Risk Assets
(Bloomberg) -- Treasuries fall as stocks, WTI crude rally; front-end underperforms following comments from Fed’s Rosengren; lack of upcoming data leaves focus on risk-asset performance.
- Data calendar light, no Fed speakers as FOMC blackout period begins today; no supply
- Lack of scheduled releases should see positive risk appetite persist, barring any bearish WTI crude headlines, independent strategist Marty Mitchell writes in client note
- Rates markets sit in range, waiting for risk to resolve to the upside or downside; may see further weakness in the belly, BMO’s Aaron Kohli writes in client note
- S&P futures extend rally in London session; lots of focus on 2,100 level in e-mini futures, says one trader based in London
- Still like being short 10s on the 5s10s30s fly, RBS’s John Briggs writes in client note
- Current consolidation has run its course, momentum turning back to 10s cheapening, target -18bps
- Many analysts hold a neutral bias on USD rates duration, and expect stability in USTs
- View is shared by clients, with the street sitting long significant amounts of USD rates gamma, according to traders
- Tactically, hold neutral bias, looking for more choppy price action, support at the 1.80% in 10Y yields (Mar 16 38.2% retrace/Mar range riches/50-day MA, JPMorgan says in client note
Alert:
HALISTER1Source: BFW (Bloomberg First Word)
People Aaron Kohli (Bank of Montreal)
Eric Rosengren (Federal Reserve Bank of Boston)
John Briggs (RBS Securities Inc)
Marty Mitchell (The Mitchell Market Report LLC)
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