US GOVTS: Going quietly into weekend; next week a toss up


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BOSTON, Feb 17 (IFR) - Expectations are for a quiet afternoon for treasuries now
that Europe has gone home and the domestic crowd - along with Canada - look
forward to a three day holiday weekend.

Flows are said to be thin on the ground with retail particularly quiet with
professionals doing a bit of positional tweaking on both side of the bid/ask.
With an unappealing risk/reward proposition few new trading initiatives - long
or short - are seen going on this afternoon if the buying of dips remains the
better trading bias.

On this, there is some thought that rate-lock selling for next week's pipeline
of new corporate issuance may occur if underwriting desks are guiding to a light
corporate issuance calendar partly due to the abbreviated trading week.

The week though also brings with it a slug of treasury supply -- $88 bn in 2s,
5s and 7s - that barring more distressing headlines and/or more souring on the
Trump trade may well allow for a modest pullback in the range to underwrite as a
set-up for the month-end portfolio duration extension trade.

Little need though to rush the trade, but rather enjoy and reenergize over the
weekend to revisit it all come Tuesday. Kenneth.logan@tr.com /db

 

 



This article appears in: Politics , Stocks


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