TYZ call buying
September 3, 2024
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–Friday featured higher yields, with 10s up 4.4 bps to 3.909% and 30s up 4.6 bps to 4.196%. 2/10 spread once again threatening to go positive, ending at -1.4 bps. On 7-Aug this spread reached -2.5 bps; these are the highest levels since July 2022. For now, it can be considered a double top with the interceding low on 19-Aug at -20 bps. However, the upward trend this summer has been powerful, having rallied from -50 in late June. Buy pullbacks.
–Some reasonably large new buys in TYZ calls Friday: TYZ 116c covered 113-165, 39 paid 10k. TYZ 117c 28 paid 9k. TYZ 116.5/117c stupid cov 113-19 with 50d, 61 paid 12k. With TYZ4 113-18s calls were 40, 33, 27 at settle.
–News today includes ISM Mfg, expected 47.5 from 46.8. Construction Spending 0.1 from -0.3.
