Positives 1)After little change seen in the prior 3 weeks, purchase applications to buy a home rose 2.6% w/o/w and is up a robust 40% y/o/y. Refi's were up by 3% w/o/w and 60% y/o/y. The average 30 yr mortgage rate was little changed at 3.07%, just off the record low. 2)The August NFIB small business optimism index rose 1.4 pts m/o/m to 100.2. Bill Dunkelberg, …
[Read more...] about Succinct Summation of the Week’s Events – 9/11
Positives 1)In the August payroll report, the household survey said 3.76mm jobs were added and when combined with the labor force increase of 968k, the unemployment rate fell to 8.4%. The all in U6 rate fell to 14.2% from 16.5%. This was helped by those saying they are 'self employed' which rose by 251k and 'multiple jobholders' which rose by 182k. Census …
[Read more...] about Succinct Summation of the Week’s Events – 9/4
Positives 1)The further reopening of the global economy was reflected in the July goods trade data where exports rose 11.8% m/o/m after a 14.3% rise in June. Imports jumped by 11.8% m/o/m after increasing 5.1% in June. On an absolute basis for perspective, exports totaled $115b vs $136b in July 2019 and vs $137b in February 2020. Imports were $194b vs $196b in …
[Read more...] about Succinct Summation of the Week’s Events – 8/28
Positives 1)The August Markit manufacturing and services composite index rose to 54.7 from 50.3 with manufacturing rising to 53.6 from 50.9 and services at 54.8 from 50 (first time above 50 since January). With services, "greater client demand and increased marketing activity led to a renewed rise in overall new business." Export orders also improved as did …
[Read more...] about Succinct Summation of the Week’s Events – 8/21
Positives 1)Initial jobless claims totaled 963k, 137k less than expected and down from 1.19mm (revised up by 5k) last week. Also positively, continuing claims, delayed by a week, continued to trend lower to 15.49mm vs 16.09mm in the week prior. The estimate was 15.8mm. Those collecting Pandemic Unemployment Assistance (non seasonally adjusted) fell to 489k from …
[Read more...] about Succinct Summation of the Week’s Events – 8/14
Back in the time when Alan Greenspan was the Fed Chair one of the things he said is when he'd wake up in the morning the first market check he did was the 10 yr yield. I'll argue that now is the time to wake up and see where the 30 yr yield is trading at in gauging the markets opinion of growth and inflation because the Fed has polluted the market messaging of the 10 …
[Read more...] about Let’s reappoint the 30 yr bond as the go to
Longer term interest rates are moving to the high of the day after a poor 30 yr bond auction. The yield of 1.406% was a full 2 bps above the when issued. The bid to cover of 2.14 was the lowest since July 2019 and well below the one year average of 2.35. Dealers got stuck with 28% of the supply, the most since July 2019. In response, the 10 yr yield is now just …
[Read more...] about Poor 30 yr auction, longer term yields at high of day
With the 10 yr note yield microscopic but at the highest level in 5 weeks, the 10 yr auction was pretty good. Positively, the yield of .677% was a hair under the when issued and direct and indirect bidders took about 80% of the auction, matching the most since April 2019. The fly though was the bid to cover of 2.41 which was slightly below the one year average …
Positives 1)The BLS said 1.76mm jobs were added in July with 1.46mm of this in the private sector. This is above the estimates of 1.48mm and 1.20mm respectively. Revisions were modest in the two prior months, with a net combined add of 17k. This also compares with the 4.79mm headline and 4.74mm private sector added in the prior month. The household survey added …
[Read more...] about Succinct Summation of the Week’s Events – 8/7
As we continue to see nominal interest rates melt away, we are also seeing a continued rise in inflation expectations and thus a further decline in real yields. After rising by 3 bps on Friday, the implied inflation rate in 10 yr TIPS rose another 3 bps yesterday. At 1.58%, that is the highest since late February when the conventional 10 yr yield stood at 1.70%. Thus, …
Peter is the Chief Investment Officer at Bleakley Advisory Group and is a CNBC contributor.
