Market Rumours

2010/11/18 17:58*DJ Japan Govt Maintains View That Economy In Lull

2010/11/18 17:33=DJ DATA SNAP: Euro-Zone Current Account Deficit Rose Sharply

2010/11/18 17:32*DJ UK Oct Retail Sales Forecast +0.5% On Mo; +0.1% On Yr

2010/11/18 17:31*DJ UK Oct Retail Sales +0.5% On Mo; -0.1% On Yr

2010/11/18 17:31*DJ UK Oct PSNCR Was Expected At +GBP6.0B

2010/11/18 17:31*DJ UK Oct PSNCR +GBP2.4B Vs +GBP6.7B Year Ago

2010/11/18 17:30*DJ UK Oct PSNB +GBP10.3B Vs +GBP10.1B Year Ago

2010/11/18 17:30*DJ UK Oct PSNB Was Expected At +GBP9.4B

2010/11/18 17:05*DJ OIL FUTURES: December Nymex Crude Hits $82/bbl

2010/11/18 17:01*DJ Irish Central Bank Chief Foresees "Substantial Loan"

2010/11/18 17:00*DJ Euro-Zone Sep Adj Current Account Deficit EUR13.1B

2010/11/18 17:00*DJ Euro-Zone Deficit Was EUR6.9B Aug

2010/11/18 16:34=DJ PRECIOUS METALS: Gold Rallies In Asia On Bargain Hunting

2010/11/18 16:19DJ Tokyo Shares End Higher; Bank Rally Sends Nikkei Over 10,000-2-

2010/11/18 16:08*DJ Stoxx Europe 600 Index Up 0.5% After The Open

2010/11/18 16:08*DJ FTSE 100 Up 0.7% After The Open

2010/11/18 15:46DJ Tokyo Shares End Higher; Bank Rally Sends Nikkei Over 10,000

2010/11/18 15:32*DJ OIL FUTURES: ICE January Brent Crude +$1.03 At $84.31/Bbl

2010/11/18 15:17DJ 10-Year JGB Yield Hits 2-Month High After Poor 20-Year Tender
At 0600 GMT Change TFX June 3-Mos Euroyen Price: 99.655 flat TSE Dec 10-Yr JGB Futures Price: 141.45 .51 10-Yr 1.0% JGB No. 310 Yield: 1.100% +0.045 TOKYO -The yield on benchmark 10-year Japanese government bonds rose to a two-month high on Thursday after results of a closely-watched 20-year auction turned out weaker than expected. The 10-year cash JGB yield rose to 1.1% in the afternoon for the first time since Sept. 15 and climbed further in after-hour trading to 1.105%--its highest since Sept. 14. Mitsubishi UFJ Morgan Stanley Securities' strategist Katsutoshi Inadome expects the 10-year yield to climb to as high as 1.15% within this year. The bearish momentum in the JGB market will likely continue until the beginning of the next year when economic data are expected to start showing clear deterioration in the domestic economy, he added. Lead December JGB futures also finished the day down 0.51 at 141.45. Earlier in the day, Japan's Ministry of Finance sold Y1.001 trillion worth of 20-year JGBs at a lowest price of 99.70--lower than traders' expectations for 99.90-99.95--yielding 1.920%. The bonds carry a coupon of 1.9%, higher than the October issue's 1.8% and reopening the No. 121 issue sold in September. Increasing volatility in the 20-year zone seemed to discourage those who had been expected to buy the new issue--such as banks--while life insurers, traditionally the biggest buyers of superlong bonds, have recently shifted focus to 30- and 40-year notes in search for longer durations, Mitsubishi UFJ Morgan Stanley's Inadome said. Thursday's poor auction results 'confirmed continued caution in the super-long sector,' said Maki Shimizu, a senior strategist at Citigroup Global Markets Japan. However, 'the yield curve is unlikely to keep steepening' because the economic outlook remains cloudy and the supply and demand balance in the JGB market is expected to improve in December, Shimizu added. Other Cash Bond Yields At 0600 GMT Change 2-Year 0.1% JGB No. 298 Yield: 0.160% +0.010 5-Year 0.3% JGB No. 92 Yield: 0.400% +0.025 20-Year 1.8% JGB No. 122 Yield: 1.935% +0.020 30-Year 2.0% JGB No. 33 Yield: 2.085% +0.025 ***********
2010/11/18 14:56DJ RBA Deputy Governor Says Nov Hike Was Prudent, Modest Tightening Of Rates
SYDNEY -Australia's mining-rich economy is grinding against capacity constraints and inflation is much more likely to rise over the next few years, the central bank said Thursday.Ric Battellino, Reserve Bank of Australia Deputy Governor, told an audience in Perth the most pressing challenge for policy makers was managing the lack of spare capacity in the economy at a time when the money is gushing in thanks to record demand for commodities.For those reasons, a surprise interest rate hike announced Nov. 2 was a prudent early move, Battellino said.Australian miners are expected to invest heavily over coming years to expand production of iron ore and coal in order to meet orders from Asia, especially the country's biggest trading partner China.Already the central bank has shot out of the starting blocks to lead developed nations in raising interest rates with seven increases announced since October 2009, the latest on Nov 2.Battellino said the decision to come off the sidelines after a pause extending back to May was driven by the central bank's forward looking policy approach and was needed given the upward trajectory for inflation in 2011-12."This is consistent with the forward-looking approach to monetary policy that the bank has been following for close to 20 years now, and which on balance has helped to keep the economy on a sustainable path," Battellino said.Australia's economy has expanded uninterrupted for the last 20 years so it isn't surprising that spare capacity is limited.The A$1.3 trillion economy, which has returned to average rates of economic growth having avoided recession in the wake of global banking sector upheavals in 2008, will struggle to grow at much faster rates without adding to inflation pressures, he said."With a large amount of money continuing to flow into the country over the next couple of years as a result of the resources boom, the challenge will be to manage the economy in a way that keeps economic growth on a sustainable path, with inflation contained," he said.The comments from Battellino will reinforce market expectations that interest rates will have to rise again in 2011. For now most economists believe the RBA will sit pat as major banks have raised their mortgage lending rates sharply in recent weeks, citing rising funding costs.The RBA's benchmark cash rate now stands at 4.75%.Still, the economy will have strong underpinnings with further falls in the unemployment rate expected by the central bank, he said.With already low unemployment of 5.4%, Australia's job market has been strong for close to 18 months, providing a sharp line of delineation with other major economies where growth is weak and unemployment queues lengthy.Battellino admitted the high Australian dollar was taking a toll on business, but it is also helping to allow the economy to adjust to the mining boom, which has driven export prices sharply higher. He highlighted the pain in the tourism sector, which is Australia's third biggest export.
2010/11/18 14:54DJ Forex Options: Dollar/Yen Options Fall Ahead Of US Holiday
TOKYO -Dollar/yen options fell sharply in Asia Thursday as market participants--including hedge funds and major non-Japan banks--sold contracts before closing the books prior to the U.S. Thanksgiving holiday.Benchmark volatilities implied by one-month at-the-money options fell to 10.05%/10.75% from 10.95%/11.65% in New York Wednesday.One player sold a six-month, at-the-money straddle option contract with implied volatilities of 11.95% and an unknown face value, said a dealer at a major Japanese bank. Straddles profit on wide swings in the exchange rate.The stable underlying exchange rate also contributed to falls in volatilities, the dealer said.The greenback traded in a tight, Y83.11-Y83.40 range in the Asian morning.The dealer said the mid-point of volatilities may continue to fall toward 10.00% in the near term. That compares with the current level of 10.40%.
2010/11/18 14:41DJ UK Gives Single Agency Listings, Insider-Trading Oversight -FT
A newly formed U.K. agency will regulate companies that list stock on London exchanges and will prosecute insider trading, the Financial Times reported late Wednesday, citing an official in Britain's coalition government. The dual role granted the Consumer Protection and Markets Authority resolves two remaining questions in the government's plan to split the Financial Services Authority in 2012. Many in the financial services industry had lobbied for such a move. Mark Hoban, financial secretary to the U.K. Treasury, wrote in an opinion article for the FT that the industry 'made a strong case that the same body should regulate both the new listing of companies and the ongoing trading of existing securities.' He also said the unified CPMA will strengthen the U.K.'s voice on markets issues in Europe. Website: www.ft.com -; 212-416-2900
2010/11/18 14:39=DJ WORLD FOREX: Euro Up Vs Dollar As Ireland Worries Ease For Now -3-

2010/11/18 14:38=DJ WORLD FOREX: Euro Up Vs Dollar As Ireland Worries Ease For Now -2-

2010/11/18 14:30=DJ WORLD FOREX: Euro Up Vs Dollar As Ireland Worries Ease For Now

2010/11/18 14:26DJ Treasury Lacks Power Over Bank Foreclosure Practices -Official

2010/11/18 14:11*DJ OIL FUTURES: Dec Nymex Crude Up $1 At $81.44/Bbl; Weak Dollar

2010/11/18 14:10*DJ Nikkei Stock Average Closes Up 2.1% At 10,013.63

2010/11/18 14:07*DJ Nikkei Stock Average Highest Closing Level Since June 22

2010/11/18 14:06DJ PBOC Adviser: Developing Nations Should Seek Stability In Major Currencies - Report
BEIJING -China and other developing countries should seek a mechanism to ensure exchange-rate stability among major currencies, and seek to restrict the 'asymmetric behavior' caused by the dollar being both a domestic and international currency, People's Bank of China adviser Xia Bin wrote in an article in the latest issue of the PBOC-backed magazine China Finance. Developing countries should 'call for and participate in a series of actions to improve the international financial system,' Xia said in the article published Tuesday. China also shouldn't rule out temporary, strong restraint on the expansion of credit by insitutions as the country faces excessive domestic liquidity and difficulty controlling economic conditions, Xia said. Xia also reiterated China needs appropriate interest-rate and exchange-rate policies, including counter-cyclical policies, among other measures to keep its financial system stable. He didn't elaborate.
2010/11/18 14:06*DJ Dollar Hits Intraday Low Of KRW1,133 Vs KRW1,143 High Earlier

2010/11/18 14:05*DJ Nikkei Stock Average Rises Over 2.0%

2010/11/18 13:57*DJ Nikkei Stock Average Breaks 10,000 Mark

2010/11/18 13:31*DJ Dollar At KRW1,140.9 Vs KRW1,136 Low So Far Today, KRW1,144.9 Wed

2010/11/18 13:10*DJ RBA Says Economy Has Limited Spare Capacity After 20 Year Expansion

2010/11/18 13:06*DJ RBA Says Overall Economy Is Doing Very Well; Unemployment To Fall

2010/11/18 13:03*DJ RBA Says Nov Hike Consistent With Forward Looking Policy Approach

2010/11/18 12:30=DJ TIP SHEET: John Hancock Fund Sells Treasurys As Fed Buys Them

2010/11/18 12:19*DJ 10-Year JGB Yield Rises To 1.1%; Highest Since Sept 15

2010/11/18 11:54*DJ Nikkei Nears 10,000 Mark As Japan Financials Continue Rise

2010/11/18 11:41=DJ HEARD ON THE STREET: Ireland Will Win This Game Of Bluff

2010/11/18 11:31=DJ ICE's Credit Derivatives Clearinghouse Seeks To Register With CFTC

2010/11/18 11:27=DJ FED WATCH: Weak Core CPI Shows Why The Fed Has Chosen To Act

2010/11/18 11:18DJ Hong Kong Confirms Its First Bird Flu Case In Humans Since 2003
HONG KONG --Hong Kong has confirmed its first case of bird flu in humans in seven years, with a 59-year-old woman in a serious condition after a visit to mainland China, health officials said Thursday. The government has raised Hong Kong's bird flu alert to 'serious,' meaning there is a 'high risk' of contracting the potentially fatal disease, a spokesman for the Department of Health said. Health officials say the 59-year-old woman tested positive for Influenza A (H5), a variant of avian influenza, after she was first diagnosed with pneumonia. She is now listed in a serious condition in hospital.
2010/11/18 10:48=DJ US Treasury Takes An Initial Public Loss On GM Shares

2010/11/18 10:31DJ GM Share Sale A 'Milestone' In US Auto Industry Turnaround -Obama
General Motors Co.'s initial public offering is a 'major milestone' for the U.S. auto industry, President Barack Obama said Wednesday. The IPO 'marks a major milestone in the turnaround of not just an iconic company but the entire American auto industry,' Obama said in a statement issued by the White House. 'Through the IPO, the government will cut its stake in GM by nearly half, continuing our disciplined commitment to exit this investment while protecting the American taxpayer,' Obama said. Supporting the U.S. auto industry 'helped save jobs, rescue an industry at the heart of America's manufacturing sector, and make it more competitive for the future,' he said.
2010/11/18 10:26*DJ Nikkei Stock Average Hits Highest Level Since June 24

2010/11/18 10:14DJ IMF Chief: French G-20 Program Can Help Stabilize Global Economy
PARIS -France's ambitious agenda for the presidency of the Group of 20 industrialized and emerging nations could help to stabilize the world economy, International Monetary Fund Managing Director Dominique Strauss-Kahn told reporters Tuesday, after meeting with France's President Nicolas Sarkozy.Strauss-Kahn met Sarkozy for an hour at the Elysee Palace to discuss the French president's roadmap for its presidency of the G-20, which started last Friday. France has prioritized tasks including exploring ways to stabilize the global currency system and increase the oversight of commodities markets and commodity derivatives, amid persistent tensions on global foreign-exchange markets.The French G-20 program 'is ambitious and contains a lot of things that relate directly to the IMF,' Strauss-Kahn said. 'It augurs for a G-20 that can help a lot to stabilize the world economy,' he added.Strauss-Kahn said he had met the leaders of all countries which formerly held the G-20 presidency, stressing it is the IMF's role to serve as a 'toolbox' for the G-20.
2010/11/18 09:36*DJ Major Japan Banks, Financials Sharply Outperforming Market

2010/11/18 09:22=DJ Silver To Trade Above $30 In 2011 - GFMS

2010/11/18 08:55*DJ Obama Says GM IPO Marks 'Major Milestone'

2010/11/18 08:47=DJ Fed Could Release Draft Debit-Card Fee Rule By Year-End

2010/11/18 08:38=DJ US Could Face Loss Of Confidence If Debt Left Untackled-Panel Chairmen

2010/11/18 08:19DJ Citigroup Reviewing 14,000 Foreclosure Files For Potential Errors

2010/11/18 08:17DJ Fed's Duke: Regulators 'Quite Concerned' About Foreclosure Document Troubles
WASHINGTON - A top U.S. Federal Reserve official said Wednesday that bank regulators are 'quite concerned' about allegations of problems with the foreclosure process and plan to report on industry practices early next year.In remarks prepared for delivery to the House Financial Services Committee on Thursday, Fed Gov. Elizabeth Duke said regulators are reviewing banks' procedures for handling foreclosures and examining individual loan files.'We are prepared to take supervisory action where necessary and appropriate to hold institutions accountable,' she said.Along with the Fed, the Office of the Comptroller of the Currency, the Office of Thrift Supervision and the Federal Deposit Insurance Corp. are conducting the review.Several major lenders, including Bank of America Corp. , Wells Fargo & Co. , Ally Financial Inc.'s GMAC Mortgage and J.P. Morgan Chase & Co. , have been reviewing thousands of foreclosure cases amid revelations they used so-called 'robo-signers' to file large numbers of foreclosure documents without reviewing their contents.Mortgage lenders say they are fixing the problems and will return to a normal foreclosure process quickly.Obama administration officials say the federal agencies investigating the issue have not found evidence of a threat to the financial system.Duke said that the issue has 'cast a pall of uncertainty across the entire housing market' The central bank, she said, is working to understand the size of the threat to figure out the right response.'Delays and uncertainty resulting from flaws in the foreclosure process have the potential to delay recovery in housing markets and to undermine confidence in our financial and legal systems,' she said.
2010/11/18 08:11*DJ Nikkei Stock Average In Negative Territory

2010/11/18 08:10*DJ Treasury Could Reap $13.6B From Sale Of GM Shares With Overallotment

2010/11/18 08:08=DJ Irish Crisis Shakes Currency Markets; Investors Flee Risky Bets

2010/11/18 08:07*DJ Lead Dec JGB Futures Open Up At 141.97 Vs 141.96 Wed

2010/11/18 08:07*DJ Nikkei Stock Average Opens Up 0.1% At 9820.60

2010/11/18 07:36DJ BOE Tucker: Absolutely Determined To Return CPI To Target
LONDON -The Bank of England's Monetary Policy Committee is "absolutely determined" to push inflation back down to its target level while also seeking to safeguard the economic recovery, BOE Deputy Governor Paul Tucker said Wednesday."The Bank of England is absolutely determined to return inflation from its currently uncomfortably high level of around 3%, back down to our target of 2% over the next few years - and while we are doing that, to support recovery in the economy as well," he said in an interview with the BBC Radio Oxford.Tucker warned however that "choppy" economic waters still lie ahead for almost every U.K. business, although he said those in the export sector stand in better stead than firms that depend on increasingly expensive commodity imports.However, noting the continued "hazardous" risks facing the global economy and the difficulties some European economies are confronting, he said the U.K. government's deficit-reduction actions leave the domestic economy more "insulated" from sovereign debt concerns.
2010/11/18 07:32*DJ US Stake In GM Would Drop To About 37% -Obama Official

2010/11/18 07:32*DJ US Sale Of GM Shares Would Raise $11.8B -Obama Official

2010/11/18 07:31*DJ US Agrees To Sell 358 Million Shares In GM -Obama Official

2010/11/18 06:53DJ UK Osborne: Not Concerned About Irish Exposure Of Any UK Bank
BRUSSELS -The U.K. government isn't concerned about the exposure of the nation's banks to Ireland, and that would not be its motivation were it to provide financial help to its Irish counterpart, Chancellor of the Exchequer George Osborne said Wednesday.Osborne was speaking to reporters following a meeting of finance ministers from the European Union that was dominated by talks on how to calm bond markets, which have been spooked by fears that the cost of fixing Ireland's banking system will make it impossible for the government to repay its debts.The U.K. has been asked by members of the euro zone to contribute to a financial rescue package, arguing the U.K. has a big stake in stabilizing the Irish economy given the large exposure of its banks to Irish borrowers.Osborne earlier said the U.K. is ready to help."Our engagement in this...is because we are good neighbors, not because we have any concerns about any particular U.K. bank," he said.There has been speculation that one condition for providing the financial help would be that the Irish government raise its corporation tax rate from 12.5%. Some previously U.K.-based companies have moved their headquarters to Ireland, but that likely reflects their displeasure at the way the U.K. taxes overseas income.Osborne made it clear the U.K. government won't be insisting on that condition."It's up to individual countries to determine their tax policies," he said.Osborne repeated the government's position that it won't support an increase in the EU's budget of more than 2.9%.
2010/11/18 06:48=DJ WORLD FOREX: Euro Gains After Weak US Data Bolsters Case For Stimulus

2010/11/18 06:34DJ US Stocks Fall In Choppy Trade; Financials Weigh
The dustrial Average fell for the fourth day in five after a day of choppy trading that saw the markets dragged down by financial stocks.The blue-chip index was able, however, to finish above the 11000 mark, helped by strong earnings by retailers.The Dow finished down 15.62 points, or 0.14%, at 11007.88, while the Standard & Poor's 500-stock index rose 0.25 point, or 0.02% to 1178.59 and the Nasdaq Composite gained 6.17 points, or 0.25%, to 2476.01.Financial stocks led the declines, after The Wall Street Journal reported that the Federal Reserve will require all 19 banks that underwent stress tests during the height of the financial crisis to undergo another review of their capital and their ability to absorb losses under an "adverse" economic scenario.The Journal reported separately that the Federal Deposit Insurance Corp. is conducting about 50 criminal investigations of former executives, directors and employees at U.S. banks that have failed since the start of the financial crisis.Bank of America fell 32 cents, or 2.7% to finish at $11.62, while J.P. Morgan Chase fell 43 cents, or 1.1%, to 39.18. Regions Financial dropped 38 cents, or 6.4%, to 5.54, Keycorp sank 30 cents, or 3.8%, to 7.68 and Wells Fargo declined 33 cents, or 1.2%, to 26.86.Supporting the market were consumer-discretionary stocks, which posted strong gains after a second consecutive day of encouraging results from big-box retailers. Target gained 2.08, or 3.9%, to 55.62 after third-quarter earnings rose 23%, beating analysts' forecasts. BJ's Wholesale Club added 1.37, or 3%, to 47.54 after reporting a 32% earnings jump and raising its full-year earnings forecast.The pair of strong profit reports came a day after Wal-Mart Stores and Home Depot posted positive earnings reports, though those two stocks were among the weakest of the Dow components, falling 0.9% and 2.8%, respectively, after climbing Tuesday.Other retailers were among the best-performing stocks, with Coach adding 1.68, or 3.3%, to 52.52, and Kohl's rising 2.15, or 4.2%, to 52.80."The consumer seems to be spending again--not with unbridled optimism, but spending nonetheless--what we're seeing here is the consumer finally adjusted to the 'new normal,'" said Matthew Kaufler, portfolio manager at Federated Clover Investment Advisors. "Consumers look more willing to part with that incremental dollar coming into the holiday season."The market moves came one day after the worst market rout in months, as investors worried about new dangers in Europe and the potential for policy tightening in China.On Wednesday, U.S. consumer prices showed a modest rise of 0.2%, though taking out volatile energy and food prices, underlying inflation remained flat for the third straight month. The lack of so-called core inflation was one factor in the Federal Reserve's controversial decision this month to try to stimulate the economy by buying government bonds.Meanwhile, U.S. home construction during October fell to its lowest level in 18 months, a fresh reminder that the moribund industry's recovery is sluggish. U.S. housing starts fell 11.7% to a seasonally adjusted annual rate of 519,000, while building permits increased 0.5% to 550,000.The day's economic data "tends to lend more support to the fact that the Fed is going to continue quantitative easing," said Doug Roberts, chief investment strategist at Channel Capital Research. Looking at the inflation numbers, he said, "there's nothing to indicate any uptick on the economy--you'd almost rather have a little bit of an increase."In corporate news, GlaxoSmithKline's American depositary shares gained 1.03, or 2.7%, to 39.57 after reports that a Food and Drug Administration panel backed approval of a new lupus drug jointly developed by Glaxo and Human Genome Sciences. Shares of Human Genome Sciences, however, fell 1.37, or 5.3%, to 24.51.Qualcomm advanced 1.60, or 3.5%, to 47.98 after the chief executive of the wireless semiconductor company said it's targeting double-digit revenue and earnings growth over the next five years as it continues to benefit from soaring demand for mobile devices. "When you see a company that big and important in that space come out so optimistic, it really gets you excited," said Kaufler of Federated.Car maker General Motors said it would sharply increase the size of its initial public offering by 30% to 478 million shares in response to strong demand, which could make it the biggest IPO ever.In Europe, stocks traded higher, recovering slightly after the previous session's thrashing, as investors continued to watch developments around Ireland's financial crisis. Irish authorities will meet with officials from the European Union, International Monetary Fund and European Central Bank to decide the best way to provide any necessary support to address market risks. The Stoxx Europe 600 index finished 0.5% higher.Asian stocks finished mostly lower overnight, with China's Shanghai Composite falling another 1.9% on growing concerns that officials will tighten monetary policy. Hong Kong's Hang Seng Index dropped 2%.The benchmark 10-year U.S. Treasury note fell, pushing its yield up to 2.864%.In the commodity markets, oil futures tumbled for the fourth straight day, falling 2.3% to finish at $80.44 a barrel. Oil has now fallen 8.4% over the past four days. Gold, meanwhile, edged down, while the dollar declined against major rivals.
2010/11/18 06:30=DJ WORLD FOREX: Euro Gains After Weak US Data Bolsters Case For Stimulus

2010/11/18 06:07DJ Treasurys Fall, Give Up Rally Despite Soft CPI, Fed Buying
(Adds swap spreads and price table.) By Min Zeng Of YORK -Longer-dated Treasurys fell Wednesday as many investors cashed out of a rally ahead of new government debt supply.As of 3:52 p.m. EST, the benchmark 10-year Treasury note was 10/32 lower to yield 2.878%. Bond yields move inversely to their prices.Bond prices rose earlier as a bout of U.S. data supported the Federal Reserve's move to launch a $600 billion government debt-buying program earlier this month. U.S. housing starts suffered an 11.7% drop while a key gauge of inflation that is closely tracked by the Fed posted the smallest gain on record.Trading has been choppy after the bond market suffered heavy sell-offs from Friday through Monday. Rising criticism of the second round of the Fed's "quantitative easing" program -- an economic-stimulus effort dubbed QE2 -- has made many investors skittish about the Treasurys market, which had rallied significantly in recent months."Treasury positions accumulated over the past few months in anticipation of [the Fed bond-buying program] are now being reduced. That selling is overwhelming the actual buying by the Fed, and the weaker economic data of the past few days," said Alan De Rose, head Treasurys trader at Oppenheimer and Co. in New York.This position reduction may continue to dominate the market over the near term, said De Rose, adding that supply from a broad range of fixed-income markets, including Treasurys, corporate and municipal debt, also weighed in.The Treasury Department on Thursday morning will release the sizes for next week's sales of notes maturing in two years, five years and seven years.Stephen Stanley, chief economist of Pierpont Securities, said he expects the sizes to be unchanged from last month's auctions: $35 billion each for the two-year and five-year note auctions and $29 billion in seven-year notes.The Fed on Wednesday bought $8.15 billion in Treasurys maturing in eight years to 10 years as part of its bond-buying program. The central bank has bought $21.5 billion in Treasurys since the start of this week and plans to buy Treasurys on Thursday and Friday.The benchmark 10-year note's yield hit a three-month high of 2.970% on Monday amid rising criticism that the Fed's program will fuel asset bubbles in emerging-market nations and may generate too much inflation in the U.S. in the longer term.The 10-year note's yield has risen from the recent trough of 2.332% hit in October, though it is still below this year's peak of 4.017% set in April.Tame inflation was one of the key factors pushing the Fed to start the bond-buying program. The central bank is trying to jump-start the economy while warding off the threat of deflation, a persistent decline in consumer prices that discourages consumer spending and erodes corporate earnings.Wednesday's data reinforced the Fed's case for bond buying. The annualized consumer price index excluding food and energy rose just 0.6%, the lowest amount since records began in 1957. That is well below the Fed's informal inflation target of between 1.5% and 2%."Very poor economic data discourages those who believed [the Fed's bond-buying program] may be diminished or discontinued," said Jason Rogan, director of U.S. government trading in New York at Guggenheim Partners LLC.St. Louis Federal Reserve Bank President James Bullard, who votes on monetary policy this year, said after the CPI report Wednesday that he is worried about disinflation, adding that it is important to defend inflation from the low side."The data justified what the Fed is doing to support the economy, but trading is likely to be choppy," said Thomas Roth, executive director in the U.S. government bond trading group at Mitsubishi UFJ Securities Inc. in New York. "The whole world has been long Treasurys and before year-end people don't want to take a lot of risks."Roth said he still expects yields to go lower again but this will take time, adding that the 10-year note's yield will range between 2.5% to 3% in the near term.U.S. Swap Spreads MixedU.S. two-year swap spread, which measures the differential between the two-year swap rate and two-year Treasury yield and a main gauge of credit risks, was 1.75 basis points tighter at 18.25 basis points. The 10-year swap spread was 0.75 basis point wider at 15.5 basis points.COUPON ISSUE PRICE CHANGE YIELD CHANGE3/8% 2-year 99 25/32 up 1/32 0.492% -1.2BP1/2% 3-Year 99 7/32 up 2/32 0.759% -2.4BP1 1/4% 5-year 98 31/32 dn 1/32 1.467% +0.9BP1 7/8% 7-Year 98 9/32 dn 8/32 2.140% +4.2BP2 5/8% 10-year 97 26/32 dn 10/32 2.878% +3.6BP4 1/4% 30-year 99 5/32 dn 14/32 4.299% +2.7BP***********2-10-Yr Yield Spread: +239 BPS Vs +234 BPS Source: Tradeweb
2010/11/18 05:45*DJ NZ 3Q Producer Input Prices +0.7% Vs 2Q; Consensus +0.3%

2010/11/18 05:45*DJ NZ 3Q Producer Output Prices +1.2% Vs 2Q; Consensus +0.6%

2010/11/18 05:37DJ US Stocks Fall In Choppy Trade; Financials Weigh

2010/11/18 05:07*DJ Nasdaq Ends Up 6.17 (0.25%) At 2476.01; Consumer Discretionary, Energy Gain

2010/11/18 05:06DJ OIL FUTURES: Crude Nears $80/Bbl On Worries About Demand

2010/11/18 05:06*DJ Dow Ends Down 15.47 Points (0.14%) At 11008.03; Home Depot, BofA Lag

2010/11/18 04:55=DJ Fed's Bullard: QE2 Aimed At Defending Inflation From 'Low Side'

2010/11/18 04:44=DJ Blackstone Likely Front-Runner For Citigroup's Egg - Sources

2010/11/18 04:11DJ PRECIOUS METALS: Comex Gold Slips On Easing Inflation Worries

2010/11/18 04:05DJ Irish PM: "Sensible, Precautionary" Talks With EU Counterparts
DUBLIN -Irish Prime Minister Brian Cowen said Wednesday his government is having "sensible, precautionary" discussions with its European counterparts, and reiterated that Ireland has not applied for external financial aid."We haven't started any negotiations," he told RTE Television in an interview, but he said the government was embarking on talks of a technical nature. "There are sensible, precautionary discussions taking place at the moment...We have not applied for a facility."Officials from the EU, the European Central Bank and IMF will travel to Dublin on Thursday to examine the country's finances and troubled banking system. This may include the activation of the European Financial Stability Facility, the EUR440 billion emergency loan program established to help euro-zone countries refinance their debts."The important question is to have discussions as to what the best options are and to see what would be the best terms that would apply to our circumstances," Cowen said.He added, "We first of all have to decide what our best options are...We will deal with those matters step by step."
2010/11/18 03:40*DJ Fed's Duke: Regulators 'Quite Concerned' About Foreclosure Document Troubles

2010/11/18 03:35*DJ OIL FUTURES: Nymex Crude Settles Down $1.90 At $80.44/Bbl

2010/11/18 03:23DJ ECB Constancio: Euro-Zone Recovery Ongoing Despite Debt Crisis
FRANKFURT -The European Central Bank's vice president Wednesday tried to calm jittery financial markets, saying that the debt crisis in parts of the euro zone has had no impact on the region's overall economic performance."The economic recovery is still going on at a euro-area level, as anticipated," Vitor Constancio told reporters on the sidelines of an event in Frankfurt. "There've been no consequences on the real economy of the [euro-zone] area as a whole so far," he said.Speaking at the Euro Finance Week, he said the ECB's exit from special liquidity support to banks will depend on the region's economic performance, among other things."When we decide on our policy, we take into consideration the overall situation in the euro area. We are data dependent," Constancio said.Asked how the ECB plans to address concern that some banks are addicted to central bank cash, he said: "That's the situation which is linked to the financial crisis. It is a sort of legacy and, of course, will be dealt with as we come out of this situation, as we will in the end."Constancio also referred to the ECB's lending policy, saying "we have an established collateral policy, which means that banks have to present collateral to access ECB liquidity. We proceed according to those rules."Constancio said Europe will overcome the current confidence crisis."I certainly expect [some normalization in financial markets]. Europe has proved in the recent past that it can deal with these sort of problems."
2010/11/18 02:45*DJ Irish PM: "Sensible, Precautionary" Talks With EU Partners

2010/11/18 01:38*DJ IMF Chief: French G20 Program Can Help Stabilize World Monetary System

2010/11/18 01:32DJ Bernanke Briefing Senate Panel On Bond-Purchase Plan -Reports
Federal Reserve Chairman Ben Bernanke on Wednesday is briefing members of the U.S. Senate Banking Committee about the Fed's bond-buying program, also known as quantitative easing, according to reports.Bernanke was meeting with members of the committee on Capitol Hill, Bloomberg News reported, citing two congressional aides. Reuters also reported the Bernanke appearance Wednesday.Full story at: www.bloomberg.com/news/2010-11-17/bernanke-said-to-brief-senate-banking-committee-on-latest-bond-purchases.html-; 212-416-2900
2010/11/18 01:25*DJ BOE Tucker: BOE Absolutely Determined To Return CPI To Target

2010/11/18 01:19*DJ BOE Tucker: Austerity Measures Leave UK On Better Footing

2010/11/18 01:06*DJ Fed's Bullard Sees Euro Debt As Econ Risk At Least 18 Months

2010/11/18 01:06*DJ Fed's Bullard: Fed Must 'Communicate Better' On QE, Policy

2010/11/18 01:05*DJ Fed's Bullard: Worried About Disinflation After Latest CPI

2010/11/18 01:03*DJ Fed's Bullard Sees Euro Debt Woes To Linger 'Quarters And Years'

2010/11/18 01:02*DJ Fed's Bullard: Important To Defend Inflation From Low Side

2010/11/18 01:00*DJ Fed's Bullard: Adjust Policy Based On Incoming Economic Data

2010/11/18 01:00*DJ Fed's Bullard: 'Would Love To Debate' Narrower Fed Mandate

2010/11/18 00:54*DJ Fed's Bernanke Meeting US Senators To Discuss Bond Purchases

2010/11/18 00:01*DJ OIL FUTURES: Crude Stockpiles Post Largest Drop In 15 Months