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Market Brief – Wednesday 3/31/21

Stocks rose in overnight trading and extended their gains in early trading as money flowed in ahead of quarter-end. Treasury yields also dipped in overnight trading and were heading lower in early trading. Mortgage applications fell -2.2% last week as purchase applications fell -1.5% and refinance applications fell -2.5%. ADP Nonfarm employment rose +517k in … Read more

Market Brief – Tuesday 3/30/21

Stocks fell in overnight trading but buyers were undeterred as they attempted to bid stock prices higher in early trading. After rising in overnight trading, Treasury yields opened flat on the day and were slightly lower in early trading. Redbook same-store weekly retail brick-and-mortar retail sales fell -17.4% from this time last month and rose … Read more

Market Brief – Monday 3/29/21

Stocks fell in overnight trading and were sliding in early trading as quarter-end rebalancing is meeting forced quant buying. Treasury yields fell slightly in overnight trading but sellers were lined up at the gate at the opening bell as they quickly drove 30-year Treasury yields back up to 2.4% where buyers were eagerly waiting. Stocks … Read more

The SLR Won’t Lead to Banks Selling Treasuries

With the Supplementary Leverage Ratio (SLR) rule going back into effect, rumors continue swirling that the banks will eagerly dump their Treasury holdings as the exemption to the rule encouraged them to buy Treasuries when they normally would have. Understanding how the SLR rule works, its intended purpose, and the current ratios are key to … Read more

Market Brief – Friday 3/26/21

Stocks rallied in overnight trading and extended their rally in early trading. Treasury yields were hammered higher in overnight trading but quickly met buyers after the opening bell as 30-year Treasury yields were rejected at 2.4% and headed lower. The trade deficit hit its largest level in February with a -$86.72 billion difference between imported … Read more

Market Brief – Thursday 3/25/21

Stocks fell in overnight trading but buyers were eager bidders once the opening bell rang. Treasury yields fell slightly in overnight trading but sellers were quick to push yields higher ahead of today’s 7-year Treasury Note auction. Both stocks and bonds were down in early trading with stocks facing a strong wave of selling. For … Read more

Market Brief – Wednesday 3/24/21

Stocks rose along with Treasury yields in overnight trading. Stocks were attempting to rally in early trading while Treasury yields were holding their overnight decline. Mortgage applications fell -2.5% last week as purchase applications rose +2.6% and refinance applications fell -5.1%. Durable goods new orders fell -1.1% in February and excluding food and energy, core … Read more

Market Brief – Tuesday 3/23/21

Stocks and Treasury yields fell slightly in overnight trading and were fighting to hold their overnight dips in early trading. Redbook same-store weekly retail brick-and-mortar retail sales fell -17.6% from this time last month and rose +9.4% from this time last year. New home sales fell -18.2% in February and slowed to +8.2% from this … Read more

Market Brief – Monday 3/22/21

Stocks rose in overnight trading while Treasury yields fell in overnight trading. Stocks were continuing their overnight move higher in early trading while Treasury yields were slowly drifting lower in early trading. The Chicago Fed National Activity Index (CFNAI) fell to -1.09 indicating the national economy grew at a below-average rate in February. The CFNAI … Read more

The SLR was the Common Denominator

On March 31, 2020, the Federal Reserved exempted Treasury securities and deposits at Federal Reserve Banks from the calculation of the Supplementary Leverage Ratio (SLR) rule for holding companies, or banks until the end of this month. Since the exemption went into place, stocks, commodities, and precious metals have rallied, while the dollar and bonds … Read more