There was only one show in town today, and initially markets had a hard time deciding whether it was a hit or a flop. Indices vacillated between positive and negative territory, and then decided on “flop” and sold off aggressively into the close. Powell and Co clearly had a lot to digest in the past few weeks (to say the least) and today’s announcement was key, not just for gauging the path of interest rates, but for shedding light on how The Fed is thinking about the biggest banking crisis sin…

Drumroll please! Headlines overnight of potentially more support for deposits via the Treasury spurred a re-risking in the US markets. Traders had swarmed to the safety of Treasuries the last week and a half to hide from the regional bank fallout. This pushed yields to ytd lows, while also propping the quality companies higher (think mega-tech). Those quality names maintained their gains today however, pushing the S&P Growth factor to yet another daily outperformance versus Value (13 days in a…

To hold or not to hold… THAT is the question! Fed week is now upon us, and the landscape has changed dramatically from where we stood just 2 weeks ago. The echoes of higher for longer are a faint and distant memory now as the banking system braces to stabilize itself and the broader economy with it. Monday trading served as a day of (needed) reprieve after many were hard at work over the weekend to find a suitable(ish?) mate for CS, though FRC (-47%) still getting hit after another credit do…

As humans, we may have a natural bias/conditioning to want to end things on a good note.. And while today was not exactly that, we are going to attempt to keep things positive and point out the fact that on the week we ended up over +1.43%, so… not that bad! And while St Patrick’s Day is known for its celebration of green, March 17, 2023 equity markets did not quite get the memo as they fell decidedly lower into the red and instead passed the shamrock over to the safer FICC counterparts. Gold…

Don’t call it a bailout! They are simply expressing their confidence in the country’s banking system. At least that’s how America’s largest banks are attempting to swing the news that they are depositing a total of 30 billion uninsured USD into First Republic Bank. US averages started the day off a little shaky as the Swiss National Bank made a 50 billion credit line available to Credit Suisse to help support the bank and calm financial markets. News hit in the late morning that JP Morgan and M…

The financial mess that has been encircling the US went international today with fresh concerns over Credit Suisse. With the Stoxx Banks index closing down 6.9% (and Credit Suisse -24%/ CS ADR +18.5% vs local close though), the early part of the US session was impacted negatively, culminating just after the EU close. The rush to safety continues evidenced by the sovereigns, as 10-yr Bunds moved from 2.45% to 2.12% intraday. And the US 10-yr had a similar trajectory, closing at 3.47% vs yesterda…

And round and round we go… If we lacked conviction prior, where does that put us now?! Markets were volatile, jittery, and choppy today- as expected. After initially swinging firmly back into the positive to start, we then faded off the highs into the afternoon on news that a Russian fighter jet collided with a US drone over the Black Sea. Ultimately, we were able to regain steam in the final hour and rally back to just shy of session highs into the close. Regardless, the wind was blowing…

What is it about March that seems to keep bringing balance sheet-changing events to rattle market participants? In March 2020, Covid shocked the world, as well as major indices. In March 2021, the Archegos scandal uprooted a multitude of major players. And now we have the collapse of SVB, which will surely have implications that spread farther and wider than we can currently predict. If the financial crisis had started in March, we would seriously have some questions.

The biggest US banking failure since the 2008 financial crisis. Following the failure of Silvergate Financial earlier this week, SVB Financial was taken over today by the FDIC. Making it the second largest US bank failure in history behind Washington Mutual and the first failure since October 2020. After announcing a sale of securities valuing over $20b and a share offering to raise $2b on Thursday to support finances, depositors began requesting large outflows to limit their exposure to the ba…

What started out as a slow day with some small economic data and indexes trading sideways, ended up as a brutal day for banks with indexes down nearly two percent. Let’s starts off with the data, Initial Jobless Claims came in at 211k above estimates of 195k. In the typical “bad news is good news” theme, futures erased a 30-bps pre-opening deficit and opened the day in the green. Rates followed in suit with the US10Y (3.913%) dropping 75 bps pre-open and closing below four percent. The US2Y (4…