Jan 15.

–As usual it was a quiet Monday. However there was a large buyer of March Five Year 123.25 put for 6…about 17 bps out of the money. Adding to the position, open interest was up 34k to 99k. In eurodollars it was the opposite (larger on balance), a seller of Gold June 9775p on an exit, open interest fell 29k. In any case, yields edged slightly lower and the curve was flatter in front of Bernanke’s comments, which don’t appear to have had much impact.
–Stocks held to a relatively tight range as they have through January. A rumored private equity deal for Dell was positive; weakness in AAPL was a counterbalance. I would note that the Dow Transport index is nearing an all time high with yest touch of 5602. In July 2011, 5627 was the high. Of course right after that, in August 2011, stocks slid 15%.
–Continuing the topic of transportation, there is an interesting court case claiming UAL skirted $300 million in taxes by setting up an office in a rural Illinois town, rather than in its main Chicago office, to buy its jet fuel. City of Chicago, County of Cook, is considering joining the lawsuit, because it’s just not ethical business practice, and besides, they need their cut. Ironically, the Chicago Tribune just reported on fare increases for public transit: “All types of CTA passes went up in price today, from a 16% hike on the 30-day pass to 74% on the one-day pass.” Regular one way fares are not changing unless you buy a ticket at O’Hare airport which will be $5 rather than $2.25. So, it’s ok to gouge airport travelers but not ok for a company to try to avoid the usurious grip of the state. Think of the teachers.
–Today’s news includes PPI expected -0.8 with Core +0.2. Retail Sales +0.2 but +0.5 less autos and gas. Empire State expected 0.0 from -8.1.
–In other news, Germany wants to repatriate the gold that the US Fed is holding. Fully holding in safekeeping. Not lending it out or anything like that… As times get tough, distrust grows, even among the most august institutions.

Posted on January 15, 2013 at 7:04 am by alexmanzara · Permalink
In: Eurodollar Options

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