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Why Bonds Are Rallying Despite a Fed Hike and a Stubborn Dot Plot

Why Bonds Are Rallying Despite a Fed Hike and a Stubborn Dot Plot Today promised to be one of the most interesting Fed days in a long time and it did not disappoint.  Despite a 25bp rate hike and an even worse dot plot than last time (Fed sees rates staying a quarter point higher in 2024 than they did before), bonds rallied fairly substantially.  This could have to do with a verbiage change in the statement that signified a potential shift in policy tightening or with Powell’s comments on banking issues acting as de facto tightening that prevents the Fed from needing to hike as much.  Last but not least, by saying banking issues will result in tighter credit conditions, Powell effectively told banks “hey… all your friends are going to be making fewer loans, or raising rates/hurdles for those loans.”   Econ Data / Events No significant econ data.  Waiting on the Fed Market Movement Recap 09:43 AM Just barely weaker overnight, but bouncing back in early domestic trading.  10yr unchanged at 3.607 and MBS up 2 ticks (0.06). 12:40 PM Bonds rallying in the run up to the Fed announcement, but not due to Fed expectations (otherwise stocks would be rallying as well, and they’re not).  10yr down 4.2bps at 3.566 and MBS up an eighth of a point.  03:32 PM Sharply stronger after Fed events with MBS up more than 5/8ths and 10yr down 11bps at 3.498.

10 Hot Garbage Films People Love Anyways

What movies make you go, “Yeah, this is an objectively bad movie, but man, I love this hot garbage”? After recently polling the internet, here are the top-voted films. 1. Rock-A-Doodle (1991) “Mine is Rock-a-Doodle, a much lesser known (for good reason) animated movie from Don Bluth about a Rooster who leaves a farm and becomes … Read more

12 Ways to Quit Impulse Shopping

It’s time to ask yourself, “Is this really worth my money?”

Simple, Boring, Half Point Sell-Off in MBS

Absence of Data Leaves Even More Focus on The Fed If there happened to be some significant economic data today, or on the next two mornings, financial markets might wait to see what it implied before diving head-first into the pastime of overanalyzing Fed rate hike odds.  With essentially no relevant data between now and then, the task at hand is clear: get in position for the Fed (if you’re not already) and react to any major developments in the banking sector.  Monday’s early trading suggests markets are actually right about where they want to be after a bit of overnight volatility surrounding the UBS takeover of Credit Suisse. Econ Data / Events No significant econ data Market Movement Recap 09:16 AM 10s are currently down 2.6bps at 3.412.  MBS are unchanged (5.0 coupons).  11:27 AM More legitimate weakness after an early bout of illiquidity.  MBD down 3/8ths with at least a quarter point of losses vs AM highs.  10yr yields are up 3.2bps at 3.47. 02:13 PM Weakest levels of the day with MBS down just over half a point and 10yr yields up 5.4bps at 3.492.  Stocks are up about 2/3rds of a percent.

Stocks and Bond Yields Moving Higher Together; Fed on Deck

Stocks and Bond Yields Moving Higher Together; Fed on Deck Today’s trading session turned out to be every bit as simple as it seemed like it would be this morning.  Why so simple?  There were clear indications that improved sentiment in the banking sector was fueling a ‘risk-on’ trading pattern in Europe (i.e. stock prices and bond yields moving higher together). This extended to US markets, but especially to Treasuries.  MBS actually outperformed, which isn’t too shocking considering Treasuries were the star performers when the market was trading in a risk-off direction. Econ Data / Events Existing Home Sales 4.58m vs 4.20m f’cast, 4.0m prev Market Movement Recap 08:58 AM Weaker overnight. Europe trades risk-on.  10yr up 10+ bps at 3.587.  MBS down 3/8ths.  10:41 AM Moderate improvement since 9am, but still weaker on the day.  MBS down less than a quarter point.  10yr up 8bps at 3.562. 01:40 PM Respectable 20yr bond auction without any major reaction in the bond market.  10yr up 10bps at 3.583 and MBS down just over a quarter point. 03:45 PM Stocks at highs. 10yr yields up 12.3bps at 3.606, near highs.  MBS outperforming despite a brief scare due to illiquidity.  Still down just over a quarter point.

The Secret of Financial Security: Consider Living Below Your Means

Many celebrities are happy living modestly despite the lavish lifestyle at their finger tips. If they can do it, so can you.

Simple, Boring, Half Point Rally in MBS

Simple, Boring, Half Point Rally in MBS There won’t be too many days with a half point MBS rally that are as boring as Friday.  None of the economic data was very interesting or even exceptionally relevant.  Most of the day’s motivation was set in the overnight session by a big move lower in European bank stocks and a sympathetic rally in sovereign debt.  Treasuries were, in turn, sympathetic to EU bonds and MBS expressed some sympathy for Treasuries.   Econ Data / Events Industrial Production 0.0 vs 0.2 f’cast last month revised to 0.3 from 0.0 Market Movement Recap 09:37 AM Flight to safety led by EU bank stocks in late overnight trading.  10yr down almost 12 bps at 3.46.  MBS up roughly 3/8ths of a point. 12:46 PM Best levels of the day at noon and losing some ground since then.  MBS still up 3/8ths, but down 6 ticks from highs (.19).  10yr down 17bps on the day at 3.408. 04:38 PM Slight give-back in Treasuries, but not enough to ruin anyone’s day.  10yr down 14bps at 3.44.  MBS up half a point.

Does it make sense to hold an Amex Platinum and Amex Gold card? – The Points Guy – The Points Guy

Should Amex Platinum cardholders also sign up for the Amex Gold card to compliment to what’s already in their wallet? Should Gold cardmembers add the Platinum card to their wallets? Here’s when it could make sense.