CREDIT MARKETS
Treasuries: Treasuries pared their gains Wednesday afternoon, with shorter-term securities reversing to fall lower, after a burst of risk appetite took some of the momentum from the recent rally in government debt. The 10-year Treasuries rallied as much as 1.1%, sending yields to as low as 2.08 percent. The day’s low yields were the weakest posted by the benchmark note since active trading in the security began in the early 1960s. The 30 year yield dropped 13 basis points to 2.65 percent after touching 2.5816 percent, the lowest since sales of the security began in 1977. Rates on one month bills were minus 0.01 percent, the second straight day the shortest government securities have offered a negative return. Many analysts warn, however, that the Fed’s aggressive moves could have negative repercussions: One main concern is inflation, which is often a byproduct of lower interest rates. Economic news for tomorrow - initial jobless claims and leading indicators.
Municipals: U.S. state and local government bonds rallied the most since last month as the volume of long- term debt offerings diminishes during the last full week before the Christmas holiday. Municipal borrowers have sold less than $1 billion of long- term, fixed-rate bonds this week, compared with $6.2 billion all of last week. I was in touch 5 ¼ % 35 8.30-8.25, LI Pwr 5 ¾ % 4/33 98.50-99.50. I was in touch CA Dept Wtr 5 ½ % 5/11 . the total-return gauge is still down 8.6 percent, the worst year since its creation in 1989. State and local debt also gained amid speculation that the Federal Reserve would take further steps to ease credit markets and indirectly help municipals. The final MMD was 2009: unchanged; 2010-11 yields were lower by 5 bts; 2012-16 yields were lower by 10-14 bpts; 2017-33 19 bpts; 2034-38 yields were lower by 20-bpts.
Click on chart to see larger:
Chart
Commentary/New Issues
Corporate:
$2.9 BLN, PNC Funding, Aaa/AAA, 3 part $400 MM, 6/22/11, +3ML+28bp; $500 MM, 1.875%, 6/22/11, +119.6bp; $2.0 BLN, 2.30%, 6/22/12, +133.2bp$1.0 BLN, Walt Disney, 4.50%, 12/15/13, A2/A, +337.5bp$500 MM, Safeway, 6.25%, 3/15/14, Baa2/BBB, +512.5bp
ABS:Nothing
Agency: Nothing
New Issues larger than $250mm. The fixed income offerings mentioned above are for informational purposes only. Toussaint Capital Partners, LLC, member NASD/SIPC, and/or its affiliates may be a participant in the offerinmentioned and therefore offerings will be subject to availability.
All statistical data is sourced from Bloomberg Financial Markets