Federal Reserve rhetoric moves strongly toward interest rate cut
So much for "patient." Today after the meeting of the Open Market Committee on interest rates the Federal Reserve announced that it would leave benchmark interest rates at the current 2.25% to 2.50%. But in its words the Fed delivered what the market hoped for--a...
U.S. markets counting on visit from Goldilocks tomorrow
Tomorrow, Friday, June 7, brings the May jobs report. Right now economists surveyed by Bloomberg are looking for the economy to add a robust 175,000 jobs with unemployment holding steady at 3.6% (as 49-year low) and average hourly wages growing at a very positive 3.2%...
Bond traders test the Powell Put today
U.S. stocks dropped again today with the Standard & Poor's 500 index closed down another 0.69% to 2783.03. U.S. Treasury bonds rallied with the price of the 10-yer bond up enough to push the yield down to 2.21% for a drop in yield of 26 basis points in the last...
Treasury yield curve inverts again–key to market direction?
Adding to Monday's market sell off or maybe causing Monday's market sell off or maybe just a result of the Monday sell off, the yield curve on U.S Treasuries inverted again on May 13. The yield on the 3-month Treasury bill at 2.38% ended the day higher than the yield...
Today markets see recession warning in inversion of the yield curve
It was always implicit in the Federal Reserve's decision on Wednesday that all interest increase in 2019 were off the table and that the central bank would end its $50 billion a month balance sheet run off in September. Yeah, lower interest rates are a boost to stock...
Here’s why all eyes are on the release of this Fed’s January minutes this afternoon
All Today's release of the minutes from the Federal Open Market Committee’s January meeting has the potential to move markets--maybe even more potential than usual. That's because the market is looking for guidance on a series of Fed-centric issues. First, there's the...
Trick or trend: The U.S. Treasury market is a dangerous mess last the short end–what will the Fed do to fix it?
Our regular (or occasional or perhaps occasionally regular) Friday series ( actually running on Friday this week) Trick or Trend looks at what might (or might not) be emerging investible trends. Exclusively on JAM. This post won't run anywhere else. Ever. If you've...
Bank stocks support S&P in technology stumble–but why are financials rallying here?
The Standard & Poor’s 500 was off 0.04% today. That’s a remarkably good performance given the rout in technology stocks. The Technology Select Sector SPDR ETF (XLK) was down 2.21%. If not for bank stocks, the entire market would have been sent reeling today. But bank stocks shouldn’t be rallying on a flattening yield curve. What’s up?
Trick or trend: How flat will the yield curve get?
The Treasury yield curve continues to get flatter. Today, November 27, the gap between the yield on the 2-year Treasury, at 1.74%, and the 10-year Treasury, at 2.32%, narrowed by another basis point to 58 basis points. (100 basis points make up 1 percentage point.) In the last year the yield on the 10-year Treasury has dropped by 3 basis points while the yield on the 2-year note has climbed by 62 basis points. Frequently, a narrowing yield curve is a sign that we’re headed into a recession. But not this time, in my opinion.
Notes You Need for November 22: Amazon Cloud, yield curve, Net Neutrality, TSLA, GE
In my daily trawling through the market I come upon lots of tidbits of knowledge that I think are important to investors but that don’t justify a full post. I’ve decided to start compiling these notes here each day in a kind of running mini blog that I’m calling Notes You Need. Posts in this mini-blog include items like this: 11:40 a.m.: “Bloomberg calculates that over the past 12 months, Tesla (TSLA) has burned cash at a rate of about $8,000 a minute (or $480,000 an hour.) At this pace, the company is on track to exhaust its current cash pile on Monday, August 6, 2018. Last week the company announced plans to require a $250,000 down payment from prospective buyers of its new Founders Series Roadster, even though the car is more than two years away. Reservations on its regular Roadster will cost $50,000. Companies can also pre-order electric Semi trucks for a $5,000 deposit with production scheduled to start in 2019. Despite these deposits Wall Street analysts project that Tesla will need to raise $2 billion by the middle of 2018.”
Bond market is getting the debt-ceiling jitters
The debt-ceiling extension that Congress passed ends on December 8 and the Treasury market is showing signs of worry. The U.S. Treasury has said that it can use gimmicks and work-arounds to keep the government going through January if Congress fails to fix the debt-ceiling by the time the current extension ends. Short-term Treasury bills that mature on February 1 are now priced to yield 1.16%. Bills due to mature a week later yield just 1.13%.Â
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