A billion here, a billion there, it adds up

December 9, 2020

–Another stimulus proposal, another day of new highs for stocks.  There was some pressure on the front end of the market as three years were auctioned yesterday.  Also a buyer of EDH1 9975p for 1 with the contract at 9979.5.  The two year yield edged up slightly, everything further back on the curve drifted lower in yield.  Tens auctioned today.  Volume was again light. There is continued interest in Feb TY puts, with buying yesterday of 134 and 135 strikes in size of 10k, settled 3 and 9 ref 137-26.  The 137p has the most open interest at 79k as long Jan puts are rolled.
–The rent moratorium decreed by the CDC is set to expire at year’s end with warnings of mass evictions while Congress dithers on providing aid.   From Reuters: “The day after Christmas the extended unemployment benefits that have kept 12 million people and their families afloat are scheduled to expire.  Then, mere days after that cliff on New Year’s Day, a national ban on renter evictions from the CDC is also set to lapse. Overnight, an unprecedented bill of $70 billion in unpaid back rent and utilities will come due, according to estimates by Moody’s Mark Zandi.”  This, while Door Dash is valued at $38 billion, coincidentally the same size as today’s 10y auction.

Posted on December 9, 2020 at 5:08 am by alexmanzara · Permalink
In: Eurodollar Options

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