The Upcoming Housing Boom

Bond Ticker

11:42 am - Pasted By Payrolls : The market got spanked on the (mildly) better-than-expected number that along with back end revisions smacked off bonds harder than expected. The number was hardly off the charts, but , anything on the plus side, anything, was going to send bonds offered. But this is ridiculous. The longer end is getting crushed with the inflammation of inflation expectations while Monday-morning quarterbacking on the Fed is causing the market to rethink future rate moves. The curve has been sloped steeper with the 2-10-yr yield spread now 55.9. Payrolls were up as were revisions to last month & hourly earnings. The dollar flew higher & then got blown out of the sky as euro bids firmed up & ran the pants off the shorts. Stops blew out above 1.4150 & the euro has consolidated since. Against the yen, the buck shot above range highs of 116.7500 but has been offered since hitting 117.2500. Spot gold is up a bit at 738.65 (+0.65) while crude is off at 80.95 (-0.48). Oh, BTW, early close in financials.





11:40 am - Ratings Action :
Marriott was cut to BBB from BBB+ by S&P.

11:10 am - Agency Action :
Freddie Mac will sell $3B of 3-month bills & $2B of 6-months on Tues.

11:06 am - Fed Stuff : The Fed may hold in on Halloween, but it seems unlikely they will not cut again. The "stocks are getting ahead of themselves ( says a long-term Fed watcher). There is no" guarantee they will be cutting again. In fact, the fact that they went bigger than expected last go (50bp) is an indicator that they may be on hold to see "how or if it work.s"

10:22 am - Thar She Goes : The 10-yr futures contract was slammed lower on the 4th failed attempt to get through 50% retracement of the Sep 10-20 run lower, or maybe it was the payrolls report. Either way the market is well down with short-term trendline support around 109-07 getting creamed. Currently the 50-day sma at 108-27 is propping up prices. The direction looks clearer now though, as intermediate trend lows of 108-12+ should be tested in the not too distant future. In the meantime, the market will likely consolidate these losses with a close down here at 108-27 bearish indeed. Oh, & daily momentum's pointing down again, so that can't be good.