Saturday, 8 December 2012

Non Farm payrolls surprises everyone!

A 61k beat on consensus and a drop in the unemployment rate of 7.7% below the expected 7.9% provided a surprise boost to the markets, as the effects of hurricane Sandy didn't impact the payrolls as much as many had expected.
The Bund fell 25 points of the data, with the S&P up 9 fat ticks on the back of the data. We did however fade this however, and the Bund along with Euribors surged higher on the back of a possible negative deposit rate from the ECB, this was later quashed by ECB officials, but the fact it was discussed in this month ECB meetings has put the possibility on the table.
Spreads continue to narrow, and are at low putting a squeeze on players long the spread, myself included.
I personally will continue to average, hoping for a small bounce to get out again.
There has certainly been alot more volume over the past week so hoping it continues, as its made trading that slight bit easier, if there is such a thing.
Hoping for more of the same next week!

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