Skip to main content

Week ended 1st April ,2011 – Treasuries & Bonds this week

When I first listen about the comeback of Sub-Prime & other residential mortgages from my  friend I thought he is making me April Fool but later when I saw the news I was really stunt .  Some people are thinking positive about that , they are saying that it is the sign of improving American economy .
What I think Obama administration is using this for two purposes , One is , they have no other ways to curtail the loss from it . Though it is sure that they are not looking for huge profit from these .  Second is , they are in-turn trying to make some good for US Housing market and the Mortgage situation because they are not improving much . Now if future home buyers and person who wants to take loan for buying new or old houses see some renewed  good atmosphere for these Sub-Prime Mortgage , their confidence will also boost up & they may show some interest  .

First see the Treasury Rates

3/25/11 - 4/1/11
3/18/11 - 3/25/11
3/11/11 - 3/18/11

2-Year Treasury

5-Year Treasury

10-Year Treasury

30-Year Treasury

In the initial days yields were heading higher but later it stabilize as political situation deteriorates and also through comments of some Fed people .
Treasury yields are getting some resistance in this moment , like 2-year Treasury Yield is getting resistance in 0.85 . Same way 5-Year Treasury Yield is getting the resistance at 2.30 level .
10-year Treasury Yields get some resistance around 3.50 level . During last two weeks Treasury yields saw a big up-move .
30-year Treasury Yield is creating some pattern , though it is hard to say now that whether it is going to complete that pattern or moves in the other direction . It is getting some resistance at 4.55 .

Not only in respect of stock market , Emerging market  Bond Fund is also ahead of world bond fund , while Emerging Market Fund gained 1.7% , the World Bond Fund roses 1.3%  this year . Japan’s  Government bond fell this week  because investors are looking for higher coupon at an auction which is going to happen in 5th April to sell $26.3 billion 10-year bond .

Portuguese 2-year Bond sees highest yield at 8.6% this year , as it rises nearly 3% in last 2 week . Portuguese Government said that they are missing their 2010 budget deficit target . Inflation in Portugal in at 3.5% where  Euro Area inflation roses to 2.6% . This is putting pressure on increasing interest rate  & this in-turn causing rises in Portugal’s borrowing costs .

Inflation is disturbing more or less every country now and beside the stock market and political tension it is going to be the deciding factor for Bond & Treasury movements in coming week .

NOTE :  Please see the disclaimer below this blog .

Popular posts from this blog

DAX forecast for coming week ended 15th March, 2013.

This week was very good for Dax, though it is getting resistance at 8100 range. Now it has a chance to test downside again. I think even if Dax tests lower levels, it has more chance to bounce back from around 7800 range and therefore it will again test upside.

On the other hand if it shows flat movements around 8000 range in initial days of the coming week then there is a chance that it may take a decisive call in later days. Considering the recent trends it has the chance to test higher levels may be around 8200 but that will be a very aggressive call after taking in to account the movement from last December. I will worry about the downside when Dax will be testing levels below 7600 ranges.
NOTE: Please see the disclaimer of this blog.

Fed’s rate hike Vs Sovereign rating up gradation

Financial market is very much worried about the rate hike in US, probably this is going to come in coming December. But I think that is not going to change much of the things. Even Fed hikes rate in December it will be not so much, because we are forgetting one thing that interest rate in US is around zero so even they hike rate by 0.25-50% basis points (at most) in this year that will not be enough cause for Dollars to change their locations around the world especially markets have already discounted this coming rate hike in US.

Economical problems are always better option for market than Political problems.

Traders around the world were in better condition in past when market was ruled by European debt crisis (PIIGs) than now when market is facing a situation in gulf region & related refuge problem. Not only European debt crisis is more connected with economics but its effects have created more panic in the market. As a trader in the equity market always I am looking for more volatility in the market & that is better when matter is more connected with economics, obviously this question will not come if it is a world war or something like that.
In coming days market is expecting high volatility in response of Brexit & Fed’s rate hike but as matters are progressing I feel that it may not create that much what media are highlighting. Especially when Britain’s exit may not be sure as we are seeing in different news, I think it may be going to effect their currency too. On the other hand today or tomorrow Fed is going to hike the rate so question may come about their timing.
A new …