ALARON US TREASURY FUTURES REPORT 05/13/09
ECONOMIC DATA 05/14/09: all times EST
- 8:30 AM US PPI (0.1%, 0.1% EX ); US WEEKLY JOBS CLAIMS (609K)
- 10:30 AM EIA INVENTORY #’S (NATURAL GAS)
SUMMARY OF DATA
US RETAIL SALES (-0.4% VS. 0.1%, EX AUTOS-0.5% VS. 0.3%), US IMPORT/EXPORT PRICES (EXP 0.5% VS.-0.6%: IMP 1.6% VS. 0.6%)
US BUSINESS INVENTORIES (-1.0% VS.-0.8%)
EIA INVENTORY REPORTS (CRUDE -4.7 M, RBOB -4.1 M, DISTILL +1.0 M CAPACITY UTIL 80.4, GASOLINE DEMAND DOWN 1.2% Y/Y)
US TREASURIES RALLY AFTER UNEXPECTED DROP IN RETAIL SALES REIGNITE FLIGHT TO SAFETY.
US Treasuries rebounded on Wednesday, with 30 year futures trading within a key resistance level of 123.09, after poor earnings from European banking giant ING and a surprisingly negative US Retail Sales report pushed yields to their lows levels in nearly 2 weeks. The main catalyst for the flight to secure debt was the disappointing US retail sales figures, which have underperformed expectations for the second consecutive month. The readings showed a drop of -0.4 % and -0.5% excluding automobiles. March figures were revised down -1.3%. Expectations had been for increases in consumer sales to be posted in the wake of unfreezing of credit and recessionary recovery.
Employment concerns, a lagging economic indicator, likely put the damper on consumer spending beyond necessities. Spending on gasoline also posted significant weakness, adding to concerns that the recent euphoria regarding economic recovery may at best be overheated and overdue for correction. These elements fueled purchasing of Treasuries as a safe haven bid, pushing prices higher during this window where supply concerns are secondary due to a lack of Treasury auctions for the next two weeks. Expectations are for a quiet overnight session in Treasuries, with the possibility of a slight pullback, ahead of readings on inflation from PPI and CPI.
Technically, June US 30 year futures reached near a key resistance level of 123-090 before pulling back. This level still remains significantly strong. A break of the level could result in a try of 123-230. Market could very likely fail at that level and retrace downward. Support remains in place at 120-20.
|
US DEBT FUTURES |
OPEN |
HIGH |
LOW |
CHANGE |
|
|
US M9 (US 30 YRS) |
121-290 |
123-020 |
121-20 |
122-300 |
+29.5/32nds |
|
TY M9 (US 10 YRS) |
121-075 |
121-290 |
120-305 |
121-235 |
+14.0/32nds |
Prepared by Rich Roscelli & Paul Brittain.
Past performance is not indicative of future results. The information and data in this report were obtained from sources considered reliable. Their accuracy or completeness is not guaranteed and the giving of the same is not to be deemed as an offer or solicitation on our part with respect to the sale or purchase of any securities or commodities. Alaron Trading Corp. its officers and directors may in the normal course of business have positions, which may or may not agree with the opinions expressed in this report. Any decision to purchase or sell as a result of the opinions expressed in this report will be the full responsibility of the person authorizing such transaction.
