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Markets Roundup: Inside Range, Tsys Pare Midday Gains Ahead NFP

US TSYS
  • Treasury futures drifted off midday highs, holding to a narrow session range amid robust two-way trade ahead Friday's November employment data.
  • Tsys saw delayed bid this morning after in-line weekly jobless claims data spurred buying/short covering: Initial Jobless Claims comes out in-line with expectations: 220k vs. 220k est, 219k prior revised from 218k), Continuing Claims lower than expected: 1.861M vs. 1.910M est, 1.925M prior/revised.
  • Mar'24 10Y futures currently trading 111-03 last, -1.5 vs. 111-09.5 intraday high. Initial technical support well below at 109-16.5 20-day EMA. Curves steeper but off highs (3M10Y +2.133 at -128.917; 2Y10Y +1.625 at -47.473).
  • Desks looking for FX tie-in after Japanese Yen extended rally overnight amid hawkish rate hike expectations from the BOJ on December 18. No obvious headline as $/Yen below 142.0 briefly vs. 147.30 overnight high.
  • Focus remains on tomorrow's employment data for November after this week's lower than expected JOLTS and ADP data rekindled early 2024 rate cut projections. Bloomberg consensus sees nonfarm payrolls growth of 186k in November, up from the 150k in October owing to a 38k fewer striking workers meaning strike adjusted gains should trend lower.

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