On Friday we had a big miss in Non Farm Payrolls, with 88k Jobs created in the US when expectations where for 190k. We came off in Equities as you expect and Bonds rallied. But this didnt last for long as the US markets rallied into the close and ended down a fraction of what it was down earlier. Today we are rallying so what does that tell you?
Well Bunds are above 146, highest in months, the Yield curve is flatter then ever, but Stocks continue to rise, and this is because now it is very unlikely that there will be any tightening as far as monetary policy goes for a long time still, and so cheap money remains, and since Yields are so low in other asset classes, Equities seem to make sense as there are good dividend paying stocks which will yield you much better returns then the 1.X% you will get with Uk, German or US 10 years.
Looking at Euribor Spreads we trading at the bottom of the range for pretty much all 3 month Spreads, which make buying the only logical Trade for me personally right now, but with reduced volumes and volatility, its a matter of waiting it out.
Im currently long 0s in Mar14Jun14 in Short Sterling, and long 1s in Jun14Sep14 Short Sterling.
Looking forward, there's not much in terms of data this week, so mite be pretty quiet, so hoping for some other news to spice things up!
Well Bunds are above 146, highest in months, the Yield curve is flatter then ever, but Stocks continue to rise, and this is because now it is very unlikely that there will be any tightening as far as monetary policy goes for a long time still, and so cheap money remains, and since Yields are so low in other asset classes, Equities seem to make sense as there are good dividend paying stocks which will yield you much better returns then the 1.X% you will get with Uk, German or US 10 years.
Looking at Euribor Spreads we trading at the bottom of the range for pretty much all 3 month Spreads, which make buying the only logical Trade for me personally right now, but with reduced volumes and volatility, its a matter of waiting it out.
Im currently long 0s in Mar14Jun14 in Short Sterling, and long 1s in Jun14Sep14 Short Sterling.
Looking forward, there's not much in terms of data this week, so mite be pretty quiet, so hoping for some other news to spice things up!
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