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The Bond Column

Week in Review/Week Ahead
Updated: 2010-09-06, 08:55:12 ET
Analyst: Beth Malloy

Treasuries had another roller coaster of a week (note to self: find another descriptor) with the 30-years racking up about a 36 basis point range, the 10-years went for a 30bps ride while the 2-years only tripped about 8bps.

The week was mostly focused on what was expected to be a fairly poor, albeit comparatively decent, jobs number, in the neighborhood of -100K with a 9.6% rate. Well the surprise was a mere -54K jobs (and a still ugly 9.6% rate). (There was chatter that the number had somehow been leaked.) The market gave back 2 weeks worth of gains as it tumbled.

Data through the week saw upside surprises with jobless claims improved along with pending home sales and the ISM manufacturing report. The improved tenor has held boost global growth sentiment in general  and sucked much of the safety bid out of the thinned market.

Week Ahead

The shortened week ahead has a slow start but ratchets things up a little with auctions and a smattering of data.

Tuesday will see the kick off of the week's auctions with the trimmed $33 billion 3-years, from $34 billion last going. The previous 3-year went off fairly well back in August, but as the market has been taught repeatedly, one good auction don't lead to solid outings later in the week. There will also be $30 billion each in 3-and-6-month bills and some 4-weeks.

Wednesday has the reopened $21 billion 10-years which (see above) will be more closely watched. Data will offer the Federal Reserves Beige Book of anecdotal  evidence on what all is going on in the 12 districts as well as the consumer credit report.  Minneapolis Federal Reserve President Kocherlakota will also be speaking.

Thursday has the potentially problematic $13 billion 30-year offering as well as the usual suspects initial and continuing jobless claims, which will be watched for improvement follow through. Trade balance also hits.

Friday has just whole sale inventories.

Have a great holiday weekend

 

Beth Malloy