Nov 13. Further signs of slowdown

–Stocks were smoked on Monday with the Dow down 600 points, SPX and XLF (Financial ETF) were both down 2%.  AAPL plunged 5% and GS nosedived 7.5%.  Yields pushed lower.  Though it was a bank holiday, according to futures prices at settlement, the ten year yield was down around 3.6 bps to 315.3.  The eurodollar strip from reds though golds was up 3 to 3.25 bps.  Red/green eurodollar pack spread fell 0.25 to close -3.5, a new monthly low.  The eurodollar strip continues to forecast a slow economy in 2020, with EDZ19/EDZ20 just holding at zero, and one-year spreads just behind at negative levels.
–Oil has fallen 11 sessions straight in a breathtaking decline.  As of this writing CLZ -1.33 at 58.60.
–Reuters reports that China’s total social financing is slowing, with yuan loans extended in October at 697 billion yuan vs expectations of 862b.  From the article: “…growth of China’s outstanding total social financing slowed to 10.2% from a year earlier, again an all-time low, central bank data showed.”
https://www.reuters.com/article/china-economy-loans/update-1-china-oct-loan-data-disappoints-points-to-further-slowing-in-economy-idUSL3N1XC2UT
–ECB’s Praet says euro area economy still needs support from the ECB [isn’t Italy trying to provide fiscal support with the budget?]
–NFIB Small Business Optimism this morning.  CPI is released tomorrow and Powell will be at the Dallas Fed: ‘Robert Kaplan President and CEO of the Dallas Fed will discuss national and global economic issues with Jerome Powell…”  Event at 5:00 EST on Wednesday.
Posted on November 13, 2018 at 5:06 am by alexmanzara · Permalink
In: Eurodollar Options

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