Bond & equity report for Mar. 5

SUMMARY OF UPCOMING DATA 03/05/10

· 8:30 AM US NONFARM PAYROLLS (-50K)

· 8:30 AM US UNEMPLOYMENT RATE (9.8%)

DATA RESULTS 03/04/10

· U.S. WEEKLY JOBLESS CLAIMS (469 K/475 K)

· NON FARM PRODUCT (6.9%/6.3%), ULC (-5.9%/-4.5%)

· U.S. FACTORY ORDERS 1.7%/2.0%

· U.S. PENDING HOME SALES (90.4/96.6)

· EIA NAT GAS INVENTORY (-116 BCF)

· US THREE-, 10-, 30-YEAR BOND ANNOUCEMENTS ($40B,$21B,$13B)

U.S. DEBT REVIEW AND OUTLOOK

U.S. Treasuries rebounded on Thursday, with the June 30-year Treasury futures rising to test resistance levels of its trading range. Buyers found value in the long end of the curve as the shorter end of the yield curve continued to retreat, while recent short players continued to cover their positions ahead of Friday’s U.S. employment releases. The yield curve as a whole found support later in the session by a disappointing reading on pending home sales and U.S. factory orders, while the Treasury auction announcement of U.S. three-,10- and 30-year debt failed to force the market to swallow a bitter pill regarding supply (hint-the amount was actually less than $100 billion.)

The conflicting data and outlook combined with a rebounding U.S. dollar created perceived value in U.S. Treasury fixed income. The greenback was boosted by a retreat in most of the major world currencies after the European Central Bank and the Bank of England kept their major interest rates unchanged and extended certain monetary support programs.

Hold on for the first Friday rollercoaster ride.

Technically, June 30-years held below the resistance level of the contract’s recent trading range. Market continues its pattern of range trading with downside move setting up to test 117-07. Resistance sets up at 118-04, which could represent a double top that should hold resulting in a pullback.

U.S. EQUITY REVIEW AND OUTLOOK

S&P Futures traded in a tight range ahead of Friday’s employment data. Better readings on employment data and worker productivity were offset by lower than expected readings on pending home sales and factory orders. Stocks appear to be straining to find continued upward momentum, as many traders took profit in commodity equity positions and bought into value plays within sectors such as the financials. Bank stocks were among the best performers as the group continues to breathe sighs of relief with regards to proposed government regulations and its effect on the banks ability to create sustainable revenue.

Health care stocks continued to be pressured by the uncertainty of government reform. A White House meeting between the President and executives of health insurance firms to discuss insurance premium hikes continued the perceived Administration challenge (or attack) on the sector.

Technically, March S&P futures continue in a flattening upward momentum ahead of potential volatility from the payroll number. In order to take this volatility into account, look for the market to have possible upside resistance set up at 1128.50, with 1133.00 as the first breakout level above resistance. Initial support sets up at 115.75.

US DEBT FUTURES

OPEN

HIGH

LOW

CLOSE

CHANGE

US M0 (US 30 YRS)

117-08

118-02

117-02

117-26

+26/32nds

SP H0 (S&P 500)

1119.50

1123.30

1115.70

1122.30

+3.70

Prepared by Rich Roscelli & Paul Brittain. PLEASE VOICE YOUR MARKET OPINIONS, THOUGHTS, AND QUESTIONS. EMAIL TO RICH@BINVSTGRP.COM Additional Information can be found at WWW.WHITEHALLVEGAS.COM

Past performance is not indicative of future results. The information and data in this report were obtained from sources considered reliable. Their accuracy or completeness is not guaranteed and the giving of the same is not to be deemed as an offer or solicitation on our part with respect to the sale or purchase of any securities or commodities. Whitehall Investment Management, its officers and directors may in the normal course of business have positions, which may or may not agree with the opinions expressed in this report. Any decision to purchase or sell as a result of the opinions expressed in this report will be the full responsibility of the person authorizing such transaction.

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