The mob is having a riot

February 18, 2021

–Yields mixed in spite of robust retail sales data.  30’s fell a couple of bps to 205.4.  Front end had a strong bid with a new all-time low in libor of 0.18138.  2yr note eased 1.4 bps to 10.7. However blues and golds in dollars were down 1-3 bps.  A couple of late large trades…+25k TYM 132 p 18-20…settled 22 vs 134-21, about 30 bps away.  Seller over 50k 2EU 9912/9887ps 3.5 ref 9934.0, settled 3.75 vs 33.5.  Both new trades, though this latter could be against the 3EU 9937/9862 combo from last week (long puts).   EDU3/EDU4 (green/blue Sept) settled 51.0 at 9933.5 vs 9882.5.  Quite a difference from front EDU1/U2 at 7.

–Philly Fed today expected weaker at 20 vs 26.5.  Not sure this makes a difference but Price Paid in the last report soared to 45.4 from 24.9…the high in 2018 was just over 60.  The market is already pricing concerns about stronger data and higher inflation pressure, the question is how much is already reflected?  The answer is ‘not enough’.

–In dollars, white pack +1.3 on the day, reds +1.75, greens +0.875 and blues -1.25.  So still seeing new highs across the ED curve.  2/10 at 118.5 up 1 on the day to a new high. 

–Other news includes Jobless Claims expected 770k from 793.  Housing Starts expected 1666k from 1669k.  Philly Fed 20 from 26.5.  

–Riot Blockchain (RIOT) has gone from 20 to 80 in the month of February as bitcoin has also popped.  Thank goodness these technologies don’t rely on electricity.  WTI also at a new high this morning, with CLJ1 over $61 from sub 38 just four months ago in November. 

Posted on February 18, 2021 at 5:09 am by alexmanzara · Permalink
In: Eurodollar Options

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