EFFECTIVE 5:00 PM EASTERN TIME: 11/19/97 /_________________\
KEY INDICATOR CURRENT CHANGE FROM LAST YIELD |6-Mth CD :5.80% *|
--------------- --------- ---------------- ------ |11th COFI:4.941% |
3-month T-Bill: 5.12 - down 2 basis pnts-5.26% |6Mo-LIBOR:5.805% |
10 Year T-Note: 102 09/32 - up 6/32 -5.81% |1Yr TBill:5.44% *|
Long Bond.....: 101 09/32 - up 18/32 -6.03% |3Yr TBill:5.76% *|
Dow Jones.....: 7724.74 - up 73.92 |5Yr TBill:5.81% *|
FHLMC 60 day..: 7.36% - down from 7.38% (11/18) |10YrTBill:5.88% *|
FNMA 60 day...: 7.33% - down from 7.36% (11/18) |30YrTBond:6.12% *|
|PRIME - 8.500%|
Todays Interest Rate/Loan Fee Pricing Trend: |DISCOUNT - 5.000%|
*** DOWN/STABLE *** |FED FUNDS- 5.50 |
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* Wkly Average ending 11/14
. The Nikkei fell mainly due to comments from Japanese Prime Minister Hashimoto speaking about the banking problems in his country. "I never said we would inject public funds" into the banking system. While this would be good for the U.S. Bond market because it would mean that Japan would not be selling Treasuries to fund the bail-out, it leaves to question how Japan would fund this.
Tomorrow we get Initial Jobless Claims, the Trade Deficit and the Philadelphia Fed Index. Also tomorrow, Fed Chairman Alan Greenspan is scheduled to testify before the Senate Budget Committee regarding Social Security.
The Commerce Department reported this morning that Housing Starts rose 1.4% in October to total a seasonally adjusted annual rate of 1.53 million - the market had forecast 1.47 million. But the gain was limited to multifamily homes as a double-digit decline in the Northeast held back single-family construction. Starts during the first 10 months of 1997 totaled 1.3% less than they did during the same period last year.
Single-family starts, about 80 percent of the total, fell 3.8% to a 1.14 million rate after jumping 8.8% a month earlier. Construction of apartments and condominiums shot up 20.6%.
Regionally, starts in the Northeast plunged 15.4%. That offset gains elsewhere -- 3.6% in the West; 3.6% in the Midwest, and 2.6% in the South.
Applications for building permits, often a barometer of future activity, did slow in October, rising just 1.1% to a 1.48 million annual rate following September's 4.5% surge. Still, the October rate was the strongest since a 1.49 million rate in April 1996.
Bond prices ended slightly lower yesterday, as profit-taking and continued concerns about events in Asia negated the impact of favorable inflation news here. In late trading, the benchmark 30-year Treasury bond was down 3/32, raising its yield slightly to 6.066% from 6.059% late Monday.
Treasurys gained early in the session after the Labor Department said consumer prices, either including or excluding food and energy, rose a moderate 0.2% last month. The gains, which were in line with forecasts, suggested that inflation remained subdued at the consumer level despite indications that labor markets remained tight amid brisk economic growth.
But the bond market quickly reversed course. Traders cited profit-taking and concerns that Japan's government may sell some U.S. government securities as part of an effort to boost its stock market and support troubled financial institutions.
Traders and analysts said that despite generally stronger performances in recent days by stocks, the Treasury market wasn't yet ready to shift its focus away from Asia and back to U.S. economic fundamentals....