Tripping Higher : The market has located another flight to quality bid this morning with a flip lower in global equities & stock futures courtesy of a run of bad headlines. Oil is soaring on a pipeline explosion, equities are hurting with assistance from poor retail earnings (Sears), foreclosures were up 2% mom & a whopping 94% yoy according to RealtyTrac & just good ol' fashion fear of the unknown as the Bank of England stirred things up with an announcement that the central bank would be providing extra liquidity (a la Fed's extended repo program) through the new year. All of this is creating a ripe market full of unease & queasiness leading to another spike in Libor rates as risk gets even more pricey. The 2-10-yr yield spread is a little steeper at 88.1 as curve trade tries to sort out all the mess. Bond prices in the EuroZone are also benefiting from a weak retail sales report while in Japan, bonds are bucking the trend as the stocks have managed to hold gains as yesterday's rate cut love-fest found a wider audience. Treasuries will need a big bust up in stocks to hold these gains today & data may provide some assistance. GDP will be mostly discarded as old so it'll be up to new home sale & initial jobless claims to surprise to the weak side to hold current price levels. The dollar is better on the euro & the yen even as rate cuts remain on the menu. Gold is off at 802.60 (-2.22) while crude is holding earlier gains at 92.96 (+2.34). Q3 GDP, initial jobless claims (8:30) & new home sale (10) hit today. Fed-speak has gov Mishkin & chief Bernanke late. There is another auction with $13B 5-yrs to go.
