Hello, How Low?

March 25, 2019 Chatham Financial

Prior Week Summary

Despite dovish sentiment from the Federal Reserve, U.S. equities moved lower last week as global growth fears intensified amid weak manufacturing data from Germany and the U.S. The FOMC held interest rates steady at the conclusion of their two-day policy meeting and indicated that rate hikes are on hold for the rest of the year as the central bank shifted forecasts for future rate hikes and economic growth lower. Speaking at the press conference following the FOMC’s decision, Federal Reserve Chairman Jerome Powell said, “We don’t see data coming in that suggest that we should move in either direction. They suggest that we should remain patient and let the situation clarify itself over time.” As we head to print, market participants are pricing in a rate cut at the December FOMC policy meeting.

European Union leaders voted to give the United Kingdom an unconditional, two-week extension to their departure from the E.U., averting a “no-deal” Brexit scenario at the end of this month. U.K. lawmakers are expected to vote early this week on Prime Minister May’s newest proposal with a Brexit deadline now scheduled for April 12th. Separately, Robert Mueller’s investigation into Russian interference in the 2016 presidential election concluded that “The investigation did not establish that members of the Trump Campaign conspired or coordinated with the Russian government in its election interference activities.”

The Look Forward

Market participants are looking forward to updated figures on housing starts, new home sales and consumer spending among others. The U.S. and China are scheduled to resume trade talks in Beijing this week.

Rates Snapshot

Sources: Bloomberg Finance L.P., (Treasuries) Chatham Financial (Swap Curves), FHLB Boston, Chicago, Dallas, Des Moines for FHLB Advance Rates. Wells Fargo Brokered CD Indications.

Market Implied Policy Path (Overnight Indexed Swap Rates)

Source: Chatham Financial

Fixed Income Snapshot

Source: Bloomberg Finance L.P.

Disclosures

Chatham Hedging Advisors, LLC (CHA) is a subsidiary of Chatham Financial Corp. and provides hedge advisory, accounting and execution services related to swap transactions in the United States. CHA is registered with the Commodity Futures Trading Commission (CFTC) as a commodity trading advisor and is a member of the National Futures Association (NFA); however, neither the CFTC nor the NFA have passed upon the merits of participating in any advisory services offered by CHA. For further information, please visit https://www.chathamfinancial.com/legal-notices/.

Transactions in over-the-counter derivatives (or “swaps”) have significant risks, including, but not limited to, substantial risk of loss. You should consult your own business, legal, tax and accounting advisers with respect to proposed swap transaction and you should refrain from entering into any swap transaction unless you have fully understood the terms and risks of the transaction, including the extent of your potential risk of loss. This material has been prepared by a sales or trading employee or agent of Chatham Hedging Advisors and could be deemed a solicitation for entering into a derivatives transaction. This material is not a research report prepared by Chatham Hedging Advisors. If you are not an experienced user of the derivatives markets, capable of making independent trading decisions, then you should not rely solely on this communication in making trading decisions. All rights reserved. 19-0085

Another Quarter in the Books

Capping an end to one of the best quarters in recent memory, U.S. equity markets marched higher last week a...

Market Insights - March 18, 2019

Despite mixed economic data and Brexit concerns, U.S. equity markets marched higher last week, rebounding f...

Return to Home

Chatham Financial Resource Center

Hello, How Low?

Prior Week Summary

The Look Forward

Rates Snapshot

Market Implied Policy Path (Overnight Indexed Swap Rates)

Fixed Income Snapshot

Disclosures

Previous Article

Next Article

Hello, How Low?

Prior Week Summary

The Look Forward

Rates Snapshot

Market Implied Policy Path (Overnight Indexed Swap Rates)

Fixed Income Snapshot

Disclosures

Previous Article

Next Article

Recommended Resources

Global equities plummeted again last week as fears of a prolonged economic slowdown as a result of the COVID-19 virus took center stage and outweighed significant monetary policy changes.

In a dramatic move on Sunday evening, the FOMC announced that it moved the target range for Federal Funds down to 0% - 0.25% and cut the discount window rate 1.50% to 0.25%.

In one of the most volatile trading weeks on record, the major U.S. equity markets moved modestly higher, and U.S. Treasury yields plummeted.

Global equity indices plummeted last week, sending the three major U.S. equity indices into correction territory, as the worsening COVID-19 outbreak dominated headlines.

The major U.S. equity indices moved lower for the week for the first time since early February as the Wuhan coronavirus continued to spread across the globe.

Despite global growth fears emanating from the worsening coronavirus outbreak in China and across the world, U.S. equities moved higher for a second week on the back of solid domestic economic data.

Major U.S. equity indices rebounded last week, moving higher as a perceived moderation in the Wuhan coronavirus outbreak.

Despite a strong start to fourth-quarter corporate earnings season, U.S. equities and Treasury yields tumbled last week as a worsening coronavirus outbreak in central China soured investor sentiment.

U.S. equities decreased for the week as fears stemming from a novel coronavirus outbreak in Wuhan, China dominated headlines and overshadowed the beginning of fourth-quarter corporate earnings season.

U.S. equities continued their move higher to start the year setting new all-time highs as the signing of the phase-one U.S./China trade deal.

U.S. equities began the new year on solid footing, marching higher during the first full week of the year and pushing through all-time highs, as tensions between the U.S. and Iran appeared to ease.

The majority of the U.S. equity indices ended lower for the week after geopolitical tensions in the Middle East and weak economic data domestically soured investor sentiment at the start of the new ye

Trade news dominated headlines and drove the major U.S. equity indices higher last week as the U.S. and China reached an agreement, in principle, on the terms of a phase-one trade deal.

The major U.S. equity indices ended the week mixed yet little-changed from the week prior as trade worries were countered by impressive U.S. economic data.

In a holiday-shortened week, U.S. equities returned to their winning ways as the three major U.S. equity indices climbed to record highs amid solid U.S. economic data and U.S./China trade optimism.

The six-week rally in U.S. equities came to a halt last week as pessimism over the prospects of a U.S./China trade deal dominated headlines and soured investor sentiment.

Rally in U.S. equities showed no signs of stopping last week as major U.S. equity indices rose for a sixth straight week, setting new all-time highs amid perceived progress in U.S./China negotiations.

U.S. equities rose for a fifth straight week, setting new all-time highs as U.S./China trade optimism and better-than-expected corporate earnings releases boosted sentiment and dulled recession fears.

The major U.S. equity indices continued to rally higher last week, touching all-time highs and notching a fourth consecutive week of gains...

The major U.S. equity indices moved higher last week as solid third-quarter corporate earnings results and U.S./China trade optimism boosted investor sentiment in the face of growing global growth...