Five Hundred Words 11/16/2018

Friday, November 16, 2018

Daily Writing

9:44 AM

US 10-year treasury notes have steadily ticked down throughout the week as investors seek a haven.  Equities markets remain choppy on trade tensions between the US and China.  Uncertainty regarding the outcome of UK-EU Brexit negotiations is also feeding into the broader uncertainty.

Brazilian 10-year government bond yields dipped lower on news that president-elect Jair Bolsonaro selected Santander’s Campos Neto to chair the Central Bank of Brazil.[1]

We are looking into a play to short European corporate debt.  Some European corporate bonds currently yield less than US treasuries.[2]  One way to short European corporate debt would be through shorting international corporate debt through the exchange-traded fund PICB.  We will continue to look through this and provide updates in the future.

US Treasury yields continue to move lower coupled with weakness in the equities markets.  The dollar fell and Treasuries rallied on Friday after the Fed’s newly appointed vice-chairman issued cautious comments that further reinforced the market’s view the US central bank would be in no hurry to step up its pace of interest rate rises.[3]

 

[1] https://www.bloomberg.com/news/articles/2018-11-15/brazil-s-campos-neto-to-take-over-central-bank-guedes-says

[2] https://seekingalpha.com/article/4121474-look-back-cringe-part-1-european-junk-bonds-yield-less-u-s-treasuries

[3] https://www.ft.com/content/dfa2dbc4-e9a9-11e8-885c-e64da4c0f981

 

Market Data

Resource Commodities

 

November 16, 2018

November 15, 2018

November 14, 2018

November 13, 2018

November 12, 2018

Gold Spot

1214.50

1203.25

1201.90

1199.98

1209.40

Silver

14.270

14.130

13.985

13.990

14.040

Platinum

840.00

833.00

837.00

838.00

852.00

Copper

2.75

2.78

2.76

2.72

2.69

Crude (WTI)

57.82

56.53

56.43

57.13

60.74

 

Global 10-Year Government Bond Yields

 

November 16, 2018

November 15, 2018

November 14, 2018

November 13, 2018

November 12, 2018

USA

3.08%

3.09%

3.15%

3.15%

3.18%

UK

1.42%

NA

NA

NA

NA

Germany

0.36%

0.36%

0.40%

0.39%

0.38%

Brazil

10.15%

10.39%

10.44%

10.54%

10.49%

italy

3.49%

3.51%

3.48%

3.44%

3.43%

japan

0.09%

0.10%

0.10%

0.10%

0.11%

 

Major U.S. Indexes

 

November 16, 2018

November 15, 2018

November 14, 2018

November 13, 2018

November 12, 2018

VIX

20.04

20.41

20.52

19.45

17.26

DOW

252.42

250.61

253.88

253.21

259.59

S&P 500

271.74

268.76

274.18

273.06

277.24

NASDAQ

7247.87

7129.04

7271.83

7259.66

7309.29

 

Currency Cross Rates

 

November 16, 2018

November 15, 2018

November 14, 2018

November 13, 2018

November 12, 2018

USD/JPY

112.8300

113.2200

113.9600

113.8200

113.800

EUR/USD

1.1415

1.1303

1.1303

1.1292

1.1268

AUD/USD

0.7332

0.7272

0.7224

0.7219

0.7209

CHF/USD

0.9996

0.9949

0.992

0.9929

0.996

USD/CNY

6.936

6.938

6.9509

6.9545

6.9631

USD Index

96.43

97.22

97.12

97.16

97.33

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Five Hundred Words 11/15/2018

Thursday, November 15, 2018

Daily Writing

9:44 AM

GBP/USD is trading much lower today amid Brexit negotiations which seem to be getting nowhere.

US treasury yields are also ticking lower today as investors move into more secure assets.  Volatility is not moving too much, and aside from the elevated CBOE put/call index from the start of the day, volatility has moved steadily lower throughout the trading session.

 

Market Data

Resource Commodities

 

November 15, 2018

November 14, 2018

November 13, 2018

November 12, 2018

November 9, 2018

Gold spot

1203.25

1201.90

1199.98

1209.40

1223.50

Silver

14.130

13.985

13.990

14.040

14.420

Platinum

833.00

837.00

838.00

852.00

861.00

Copper

2.78

2.76

2.72

2.69

2.78

Crude (WTI)

56.53

56.43

57.13

60.74

60.19

 

Global government bond yields (10 year)

 

November 15, 2018

November 14, 2018

November 13, 2018

November 12, 2018

November 9, 2018

U.S. 10 year

3.09%

3.15%

3.15%

3.18%

3.19%

Germany

0.36%

0.40%

0.39%

0.38%

0.40%

Brazil

10.39%

10.44%

10.54%

10.49%

10.37%

Italy

3.51%

3.48%

3.44%

3.43%

3.40%

Japan

0.10%

0.10%

0.10%

0.11%

0.11%

 

Major U.S. Indexes

 

November 15, 2018

November 14, 2018

November 13, 2018

November 12, 2018

November 9, 2018

VIX

20.41

20.52

19.45

17.26

16.87

DOW

250.61

253.88

253.21

259.59

261.49

S&P 500

268.76

274.18

273.06

277.24

277.76

NASDAQ

7129.04

7271.83

7259.66

7309.29

7406.90

 

Currency Cross Rates

November 15, 2018

November 14, 2018

November 13, 2018

November 12, 2018

November 8, 2018

USD/JPY

113.2200

113.9600

113.8200

113.800

113.7800

EUR/USD

1.1303

1.1303

1.1292

1.1268

1.1315

AUD/USD

0.7272

0.7224

0.7219

0.7209

0.7213

CHF/USD

0.9949

0.992

0.9929

0.996

1.00590

USD/CNY

6.938

6.9509

6.9545

6.9631

6.9552

USD index

97.22

97.12

97.16

97.33

96.90