Weekly Market Update

Will We Get the Pause that Refreshes Today? Treasury prices are drifting higher this morning with equities looking to rebound after yesterday’s losses, but the rebound looks tentative at this point. Trading should be quiet until the Fed decision at 2pm ET and the subsequent press conference, then expect the usual knee-jerk volatility for the…

FOMC Meeting and Jobs Report Headline Busy Week Treasury yields are modestly higher on the news that JPMorgan was the winning bidder for the failed First Republic Bank. With the resolution of the troubled bank that has some of the flight-to-safety trades from last week being reversed this morning. Currently, the 10yr is yielding 3.47%,…

March PCE Inflation Matches Expectations But ECI Could Be Fly In The Ointment Treasury yields are moving lower as the latest inflation data sets the stage for the Fed to hike another 25bps next week. That has equity traders nervous about another rate hike and the impact on earnings, while fixed income investors see it…

First Republic Bank News Will Further Tighten Credit Conditions The first quarter revelations from First Republic Bank’s earnings call on Monday evening have upped the ante on further credit tightening. While there was certainly some tightening coming in the wake of the Silicon Valley Bank (SVB) failure back on March 10, the period of uneasy…

First Quarter GDP Highlights Full Slate of Data Yields are opening the week lower as investors await first quarter GDP numbers this week and the Fed’s expected 25bps rate hike next week. Earnings will also populate the week with more attention focused on the outlook provided rather than the quarter’s results.  Currently, the 10yr is…

Yields Continue to Drift Higher Some hotter-than-expected inflation data out of the UK has Treasury yields on this side of the pond trading higher which aligns with the general drift that we’ve been experiencing of late. Given the dearth of data this week, the moves should be modest and mostly subject to Fed member comments,…

Higher Inflation Expectations Have Yields Drifting Higher The market is opening the week on the back foot as investors assess the latest Fed comments (more on that below) and higher near-term inflation expectations from consumers have yields drifting higher. Currently, the 10yr is yielding 3.56%, down 13/32nds in price while the 2yr is yielding 4.15%,…

Big Bank Earnings Solid, Retail Sales Not So Much It’s a good news is bad news kind of day as yields are higher after some early big bank earnings came in better than expected with outlooks to match. In general, the results and the outlooks were better than expected (more on that below), and that…

March CPI Hint at One and Done for the Fed Markets liked the somewhat friendly read on inflation for March that came in at or below expectations, and some of the problem areas (core services, owner’s equivalent rent, and food to name a few) slowed their recent increases and that is lending a positive tone…

Examining Bond Portfolio Trends: First Quarter 2023 Beginning in May 2012, we started tracking  portfolio trends of our bond accounting customers here at SouthState|DuncanWilliams.  At present, we account for over 130 client portfolios with a combined book value of $14.1billion (not including SouthState Bank’s portfolio), or $108 million on average per portfolio.  Twelve months earlier,…

Investors Await March CPI Numbers The week opens with light trading conditions, but what trading there is has a flight-to-safety aspect to it. Early on Monday, the US Navy sent a destroyer within 12 miles of islands claimed by China, and in waters disputedly claimed by China, and that has tensions up as the latest…

Mediocre ADP Report Adds Fuel to Treasury Rally Treasury yields continue to move lower as another soft report, this time the ADP Employment Change, signals a potential slowing in the labor market (more on that below).  Currently, the 10yr is yielding 3.30%, up 9/32nd in price while the 2yr is yielding 3.74%,  up  5/32nds in…