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UK Politics, Bank Earnings, Data and Fedspeak All In Focus

US TSYS
  • Cash Tsys have currently seen a broadly parallel rally across 2-10Y tenors (-5.5.5bp) with only the very long end lagging (30YY -3.5bps), with the long end lagging large rallies in EU FI and especially Gilts on fiscal u-turn and Chancellor replacement expectations. Bank earnings in focus before the open, with JPM and Wells Fargo hitting currently and more to come including Citi and Morgan Stanley.
  • 2YY -5.2bps at 4.411%, 5YY -5.3bps at 4.148%, 10YY -5.2bps at 3.891%, and 30YY -3.4bps at 3.883%. The 2Y pulls further off yesterday post-CPI highs of 4.529% and 10Y off highs of 4.075%.
  • TYZ2 trades 11 ticks higher at 111-11+, remaining vulnerable despite today’s bounce. Support is seen at the psychological 111-00 and then 109-23+ (Nov 30, 2007 low cont). To the upside, resistance at 111-28+ (Oct 12 high).
  • Data: Retail sales (0830ET), International trade prices (0830ET), U.Mich Oct prelim (1000ET) and business inventories (1000ET).
  • Fedspeak: George (1000ET), Cook (1030ET), Waller (1215ET), with Bullard to follow Saturday at the IMF.
  • No issuance.

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