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Free AccessMNI UST Issuance Deep Dive: Dec 2024
MNI US Employment Insight: Soft Enough To Keep Fed Cutting
MNI ASIA MARKETS ANALYSIS: Jobs Data Green Lights Rate Cuts
US TSYS: QUIET START TO WK, $15B BAYER 8-PART WEIGHS
US TSY SUMMARY: Quiet start to wk, Tsys reverse early risk-off bid on $15B Bayer
8-part issuance. Early support on trade war concerns w/China, muted volume
w/China out on holiday. Data limited to housing items, BoE policy annc Thu.
- US$ off (DXY -.030, 94.758; US$/Yen -0.14, 110.51); equities off lows (emini
-10.25, 2774.25); gold near steady (XAU -0.06, 1279.48); West Texas crude firmer
(WTI +0.74, 65.80 vs. 63.59L).
- Long end Tsy bid evaporated, slipped to session lows mid-late morning as
incoming supply from Bayer 8-tranche (3Y-30Y) spurred spec acct sales before
$15B issuance annc'd (Historical context, top 3 mega deals: $49B Verizon from
Sep 11, 2013; $46B AB InBev from Jan 13; March 6 $40B CVS 9-Part CVS). Equities
trimmed steeper losses (FANG shares kicked it off), adding to reversal in rates.
Less certain signal, US$/Yen is see-sawing off lows 110.47 last. Bit of a
dead-cat bounce for curves moving off lows at moment but likely to resume longer
term flattening w/inversion a real possibility in near term.
- Tsy cash/ylds: 2Y 99-28.5 (2.553%), 5Y 99-24.75 (2.799%), 10Y 99-17 (2.928%),
30Y 101-09.5 (3.058%)
US TSY FUTURES CLOSE: Trading mixed with the short end outperforming the long
end, curves mixed, update:
* 2s10s -0.282, 36.849 (35.503L/37.630H);
* 2s30s +0.039, 49.772 (48.245L/50.821H);
* 5s30s +0.790, 25.529 (24.341L/26.176H);
Current futures levels:
* Sep Ultra bonds down 5/32 at 157-19 (157-10L/158-10H)
* Sep 30-yr Bond futures down 1/32 at 143-20 (143-14L/144-03H)
* Sep 10-yr futures up 0.5/32 at 119-19.5 (119-18L/119-25H)
* Sep 5-yr futures up 0.5/32 at 113-08.25 (113-07.5L/113-11.25H)
* Sep 2-yr futures up 0.5/32 at 105-26.75 (105-26.25L/105-27.75H)
US EURODOLLAR FUTURES CLOSE: : Trading steady to slightly higher, short end a
bit higher while Greens through Golds are steady. Current White pack
(Sep'18-Jun'19):
* Sep'18 +0.005 at 97.530
* Dec'18 0.000 at 97.335
* Jun'19 +0.005 at 97.200
* Jun'19 +0.005 at 97.095
* Red pack (Sep'19-Jun'20) +0.005-EVEN
* Green pack (Sep'20-Jun'21) EVEN
* Blue pack (Sep'21-Jun'21) EVEN
* Gold pack (Sep'22-Jun'22) EVEN
US DOLLAR LIBOR: Latest settles,
* O/N -0.0001 to 1.9255% (+0.2106 last wk)
* 1 Month -0.0012 to 2.0837% (+0.0388 last wk)
* 3 Month -0.0012 to 2.3247% (-0.0004 last wk)
* 6 Month -0.0069 to 2.4968 (+0.0150 last wk)
* 1 Year -0.0004 to 2.7718% (+0.0320 last wk)
US TSYS: *** /REPO REFERENCE RATES: (rate, volume)
* Secured Overnight Financing Rate (SOFR): 1.91% vs. 1.90% prior, $802B
* Broad General Collateral Rate (BGCR): steady at 1.87%, $386B
* Tri-Party General Collateral Rate (TGCR): steady at 1.87%, $366B
US SWAPS: Spds steady/mixed by the bell, off early wides but maintaining narrow
range all session. Mixed flow all session, scale payers in 2s around
2.8185-2.82055%, payer in 3s at 2.9015%. Decent two-way curve flow: 2-way 2s3s,
3s and 5s vs. 10Y steepeners, 4s7s flatteners and steepeners in 5s vs. 9s and
10s. Deal-tied flow in the mix into $15B 8-tranche Bayer issuance. Latest spd
levels:
* 2Y -0.56/26.50
* 5Y +0.44/14.50
* 10Y +0.25/6.50
* 30Y +0.00/-6.25
PIPELINE: Jumbo Bayer AG 8-tranche to price today, hear $15B vs. over $50B
interest
Date $MM Issuer/Rating/Desc/Maturity/Yld/Leads; Priced *; Launch #:
06/18 $1B Duke Energy Florida, WNG 10Y fix +100a, 30Y fix +125a
06/18 Bayer US Finance 8-part, to "simplify its capital structure" after closing
it's $63B Monsanto buyout:
3Y fix +105a, 3Y FRN Libor equiv, 5.5Y fix +130a, 5.5Y FRN Libor equiv,
7.5Y +150a, 10.5Y +165a, 20Y +190a, 30Y +205a
OUTLOOK: Data/speaker calendar (prior, estimate):
- Jun 19 StL Fed Pres Bullard, Price/Wage Setting, '18 ECB Forum/CB, Portugal
0700ET
- Jun 19 May housing starts (1.287m, 1.320m) 0830ET
- Jun 19 May building permits (1.364m, --) 0830ET
- Jun 19 16-Jun Redbook retail sales m/m (-0.2%, --) 0855ET
Eurodollar/Treasury Option Summary
Eurodollar options, Pit/screen:
* +20,000 Short Sep 68/70 put sprd vs Green Sep 68/70 put sprd for net 1.5 vs
9694/0.10%
* 10,000 Short Dec 67/Front Dec 72 put strip at 3
* 7,000 Blue Mar 65/75 put over risk reversal at 0.5 vs 9695.5/0.43%
* 3,900 Short Aug 72 call at 3 vs 9702.5/0.20%
* 5,000 Blue Sep 67/72 call over risk reversal at 0.5 vs 9698.5/0.42%
* 3,500 Sep 76/77 1x2 call sprd at 0.5
* +2,250 Short Sep 70 Straddle at 22
* 4,000 Sep 75/76 2X1 PUT SPRD at 5
UPDATE: Total 6,500 Short Sep 68 puts at 5 vs 9701/0.30%
* 9,000 Sep 83/85 put sprd, on screen
* 6,000 Short Aug 71/73 call sprd at 4 vs 9705/0.10%
* 5,000 Red Dec 77/85 call sprd at 4 vs 9694.5/0.21%
* 5,000 Red Dec 76/81 call sprd at 4.5
* 12,500 Sep 77/78 1x2 call sprd at 0
Block, 10:16:42ET
* 10,000 Short Sep/Green Sep 68/70 put sprd sprd for net 1.5
* 3,000 Blue Dec 66/73 call over risk reversal at 0.5 vs 9697/0.42%
* 2,500 Sep 75/76/77 call fly at 2.5 vs 9753/0.16%
* +3,000 Dec 71/72/73 put flys, 3.0
* -10,000 short Dec 71/73 put spds, 15.0 over 75 calls
* +18,000 Mar 80 call at 1 vs 9718.5/0.10%
* +15,000 Green Dec 77/80 call sprd at 1.5 vs 9699/0.05%, adds to 30k
screen/Block
* +5,000 Green Sep 68/70 put sprd at 6.5 vs 9694.5/0.10% vs.
* -5,000 Short Sep 68/70 put sprd at 5, 1.5 net, also blocked
* -5,000 Short Sep 68 puts at 5 vs 9701/0.30%
* +3,000 Green Dec 67/70 call sprd at 1.5 vs 9699/0.05%
* +10,000 Short Dec/Front Dec 75 calls at 0
* 3,500 Sep 72/73 put sprd at CAB
Block, 0745:10ET, adds to 25k on screen overnight
* 5,000 Green Dec 77/80 call spds, 1.5 vs. 96.985/0.05%
* 25,000 Green Dec 77/80 call sprd, on screen
Tsy options, Pit/screen:
* 3,400 wk5 TY 120 calls, 10/64 vs. 119-19/0.30%
* 2,000 wk1 FV 113.2 straddles, 30/64
* 2,000 TYQ 120/122 call spds, 23/64
* 1,000 TYN 120/120.5 strangles, 14/64
* -5,000 TYQ 120/120.5 1x2 call spds, 7/64
* -2,500 FVN 113.75/114 1x2 call spds, 0.0
* +2,500 TYN 120/120.5/121 1x3x2 call flys, 3/64 net vs. 119-26.5/0.10%
--MNI Chicago Bureau; tel: +1 312-431-0089; email: bill.sokolis@marketnews.com
[TOPICS: MTABLE,M$U$$$,M$$FI$,MN$FI$,MN$FX$]
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Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.