Retail sales data and Bernanke testimony extend upside momentum

Discussion in 'Data Sets and Feeds' started by TradeTheNews, Feb 14, 2007.

  1. TradeTheNews

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    - Indices opened higher and treasury yields dipped after the January advanced retail sales report was somewhat subdued. In his prepared remarks ahead of today’s testimony, Bernanke noted the Fed sees signs inflation pressures are beginning to diminish but their predominant concern continues to be whether inflation will ease. He reiterated the Jan FOMC statement that the Fed is prepared to act if needed. Market participants have at least initially focused on the headline remarks, which have assuaged fears that he may be overly hawkish in today’s testimony. The Dow and the S&P have pushed out to new highs while treasuries continued to rally. The yield on the 10-year has fallen back to 4.75% while the 30-year is higher by more than ¾ of a point. It is worth noting that there has been little to no movement in the out month fed fund futures contracts. Bernanke’s remarks also pressured the Dollar with the US Dollar Index down 0.7% on the day but off its worst levels. April gold is up $4.50 at $672.50 after trading as high as $676.60 on the initial Dollar weakness.

    - Equity futures at or near session highs as crude futures make new lows down 1% near $58. Crude has moved lower after weekly inventory data that showed a draw down in distillate inventories, but one that was less than average estimates. The OIH has given back nearly all of today’s gains since the data. Deere is adding to the S&P as it is trading up 8% after earnings while DCX is up 4.5% after reporting and announcing substantial job cuts. LEND opened down nearly $3 after earnings but the momentum quickly reversed and it is now in positive territory. Financial stocks are having a solid day with mortgage, banks, broker-dealer, and asset management stocks all trading higher. The XLF is at session highs up 1.25%.