RJO FuturesCast

Daily Futures Market News, Commentary, & Insight

Stocks start the week higher and are moving even further up as New York trading resumes Tuesday. The record run in the stock indexes has kept note and bond prices in check, but not under the pressure that one would expect. In fact, we have a series of slightly higher bottoms since the late December lows were put in, although buyers have dried up when ten year yields hit 2.35/2.40. According to the WSJ, corporate and municipal bonds have also attracted some buying this year. The tape action should be respected and although short-term rate hikes are practically a given this year, the market seems to believe that the cycle will be subdued, and that there is some value at current levels out the yield curve. Problems in Greece, unease with upcoming French elections, and the huge run-up in stocks worldwide have some looking for alternative places to invest capital. The U.S. sovereign yields look attractive compared to German and Japanese alternatives. Upcoming reports this week include both existing and new home sales, a number of different federal government speeches, and of course surprise President Trump tweets. Despite all this, I presume that the stock market will remain the major focus. 


30yr Treasury Daily Chart

Jim Barrett