Trading was slow in front of Yellen’s inaugural congressional testimony in the House tomorrow and then on to the Senate testimony — likely a repeat of the House testimony … Peeps are still dissecting the recent disappointing jobs data and the global economic data, which have been showing numerous signs of slowing in the face of the Fed’s tapering (is not tightening) policy. Jon Hilsenrath of the WSJ wrote another article over the weekend suggesting the Fed would stay the course on the current policy and may look to the next jobs data for any clues before reacting. Also, more Fed speak scheduled: Plosser on Tuesday; Lacker, Fisher and Bullard on Wednesday, but their talking points should be limited. NOTE: The House of Representatives adjourns on Wednesday and won’t return until Feb. 26 – yes, that’s one day before budget deadline. With the clock ticking, Republicans seek a solution to raising debt limit, but not a fight . Click here to read more about this issue.
Snippets: Chatter is quick to point out from the last FOMC meeting: “asset purchases are not on a preset course, and the Committee’s decisions about their pace will remain contingent on the Committee’s outlook for the labor market and inflation as well as its assessment of the likely efficacy and costs of such purchases”.
william_blount (02/07/2014 – 15:00) IMO – 1794 SPOT, if i had to choose just one spot, has been the most valuable SPOT since the 12/18 low on the ‘BEN 1752/SPOT 1763 most important handle to hold’ post before NFP release.
When you take the last two miserable reports, 75,000 jobs created and Friday’s 113,000 jobs, that equals 188,000 jobs, basically one bad month. That’s less than 4,000 jobs per state in two months. Elway posted ISI: “In any event, the level of payroll employment in Dec was revised up by +509k. As a result, the level of payroll employment in Jan is now -866k below its prior peak. It’s likely to make a new high in the second half of this year.”
jack_broz (12:37) from a cash trader client: There’s a weird inversion @ the very front end of the curve between 1 month and 3 month bills that we haven’t seen for quite a while. I imagine it might have something to do with the debt ceiling shenanigans about to heat up It’l be interesting to see if the inversion starts creeping farther out on the yield curve.
Today started with 208k ESH and 2.3k SPH traded on Globex, ESH trading range was 1786.25 – 1794.50. Friday’s regular trading hours (RTH’s), pit session trading range was 1794.00 – 1772.70 before settling at 1793.50, up 26.9 handles.
Today’s RTH’s, pit session, opened 2 handles lower at 1792.00 - 1791.50 first 15 min… 1793 /1788.00…first hour 1793 / 1788 … the sideways to lower and back up grind was on. It was a very quiet day for the markets as the schedule awaits a number of events. For much of the midday session was spent within 3 handles – just off of the Globex and Friday’s high. william_blount (13:13) SMART deal would e to take price back up to 94+ du to FLIP, park price above it , force the PEEANS (europeans) to buy more — keep Janet happy and go for the 1802.5 -1812.5 b4 pulling the the rug out – s2L.
Kathy lunch video: http://bit.ly/1fZOvAQ
Midafternoon the S&P quietly traded a fresh intraday high of 1795.50 as the E-mini vol was tracking a modest 900k. Sam_E: when we get where we are going then the algos will decide if this was all 1 down or will the bulls be FORCED to make new highs. if all that down was 1 down then you are going to see something historic / the pit has their eyes on 2 numbers where they want a walk away trade for the rest of the year. 1805.25 and 1814.75. Following nearly $4 billion to buy in recent days, the MrTopStep imbalance Meter, MiM, showed a modest $206M to the buy side before a late read of $232M to buy. The futures traded 1794.80 area on the cash close before settling at 1794.70, up 1.2 handles. Volume was light, 1.1M E-mini’s traded.
Coming events: http://www.investing.com/economic-calendar/
Earnings pre-market: [CVS], [DF], [ICE], [GWR], [HNT], [HUN], [IR], [LPLA], [MGI], [MMC], [MOS], [PCG], [REGN], [S], TomTom, [ZTS].The House of Representatives adjourns on Wednesday and won’t return until the 26th – one day before budget deadline – House Republicans return to Washington on Monday still struggling to find a path to raising the Treasury Department’s borrowing authority, but the normally raucous caucus is in unusual agreement that the best option is to put the white-knuckle confrontations of recent fiscal wars behind them. http://wapo.st/1daIKQy