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Update: 2015-04-21 08:55:19 ET

Moving the Market

- ECB examines ways to reduce Emergency Liquidity Assistance to Greek banks

- EU officials to brief press on Friday's eurogroup meeting (08:30 ET)


4/21/2015
8:11:37 ET
10-Year:+5/32 1.87    GNMAs:     EUR/USD:1.0701    USD/JPY:119.39   
Greek Yields Higher, Little Change Elsewhere
  • Greek sovereign debt sold off on Tuesday as the ECB explored avenues to reduce its Emergency Liquidity Assistance (ELA) to Greek banks
  • The ZEW Institute's survey on German economic sentiment missed expectations and fell to 53.3 in April from 54.8 in March 
    • The current conditions index, however, handily beat expectations at 70.2 from the 55 in the prior month
  • Yield check:
    • France, 10-yr OAT: -1 bp to 0.36%
    • Germany, 10-yr Bund: unch at 0.08%
    • Greece, 10-yr note: +27 bps to 13.36%
    • Italy, 10-yr BTP: +1 bp to 1.46%
    • Spain, 10-yr Bono: unch at 1.46%
    • U.K., 10-yr Gilt: -2 bps to 1.58%

 
4/21/2015
7:33:05 ET
10-Year:+5/32 1.87    GNMAs:     EUR/USD:1.0701    USD/JPY:119.40   
Treasuries Rise, ECB Ponders Removing Support for Greek Banks 
  • The U.S. Treasury complex recovered some of Monday's losses overnight, as Bloomberg reported that the ECB is examining ways to decrease Emergency Liquidity Assistance to Greek banks
    • The news sent Greek stocks down sharply and Greek sovereign debt yields up
  • Yield check:
    • 2-yr: unch at 0.52%
    • 5-yr: -1 bp to 1.30%
    • 10-yr: -2 bps to 1.87%
    • 30-yr: -1 bp to 2.55%
  • International News:
    • The German ZEW Economic Sentiment survey for April missed expectations at 53.3 versus 54.8 in March
      • The Current Conditions, however, handily beat expectations at 70.2 versus 55.1 in march
      • ZEW Economic Sentiment for the entire eurozone also surpassed expectations, rising to 64.8 from 62.4 prior
    • Gazprom chief Alexie Miller will be in Athens today and rumors have circulated that he may be speaking with Alexis Tsipras about expanding the Turkish Stream gas pipeline
      • While a deal could provide an immediate cash infusion of 5 billion euro to Greece, experts are still skeptical that Greece would receive cash now for a project that is still in the preliminary phases of planning
    • Greece has to pay 1.7 billion euro for public wages and pensions by the end of April. It also has to pay the IMF 200 million euro on May 1st
  • No Market-Moving Events Scheduled for Today

 
4/20/2015
3:22:05 ET
10-Year:-8/32 1.89    GNMAs:     EUR/USD:1.0735    USD/JPY:119.30   
Treasuries Slip as Safe-Haven Seekers Vanish
  • After a Friday session that brought flashbacks of 2008 to some traders and featured a global shutdown of Bloomberg's data systems, skittish investors paid again for panicking. The U.S. equity indices reversed almost all of their losses today, although the European averages recovered only modestly. Treasuries gave back large chunks of their gains from Friday in a curve-steepening trade. The consensus explanation was a required reserve ratio cut of a full percentage point from China's central bank
  • Yield check:
    • 2-yr: +2 bps to 0.53%
    • 5-yr: +2 bps to 1.33%
    • 10-yr: +3 bps to 1.89%
    • 30-yr: +5 bps to 2.57%
  • News:
    • The People's Bank of China cut the required reserve ratio by a full percentage point, the biggest cut since 2008. By reducing the amount of reserves that banks need to hold for every dollar of loans, the move should reduce pressure on China's beleaguered banking system and increase its capacity to lend
    • William Dudley, president of the NY Fed and a permanent voting member of the FOMC, said that the U.S. economy should recover through the rest of the year from the Q1 slowdown 
      • First-quarter growth has been generally weak over the past five years
      • Falling oil prices have caused a drop in business investment
      • The stronger dollar may reduce growth by 0.6% this year
    • Kaisa Group Holding Ltd., a Chinese property developer, missed a $52 million interest payment on debentures due in 2017 and 2018
      • This is a long-anticipated development for those expecting stress in China's property sector
    • Greek sovereign yields hit fresh highs and the Greek federal government mandated that local governments keep their cash reserves at the central banks
      • The head of Gazprom will visit Greece tomorrow, potentially to discuss a pipeline deal that would provide a windfall for the Greek government
  • Commodities:
    • WTI Crude for June delivery: +0.46 to $57.77/bbl
    • Gold: -0.71% to $1194.50/troy oz.
    • Copper: -1.71% to $2.7265/lb.
  • Currencies:
    • EUR/USD: -0.66% to $1.0735
    • USD/JPY: +0.30% to 119.30
  • No Market-Moving Events Scheduled for Tuesday