Risk markets are struggling today on more disappointing economic data out of Germany, as well as the European Union’s decision to lower its 2019 growth forecast for the eurozone by 60 bps. Treasury prices are higher across the curve, and S&P 500 futures are down 0.6%. Three-month LIBOR fell 4.1 bps overnight, the largest one-day decline since May 2009, and the LIBOR-OIS spread tightened 3.7 bps. Three-month LIBOR is now 12.5 bps lower since the recent peak on December 20 as the market prices for a more dovish Fed. Fed funds futures and OIS had already made this adjustment in late 2018, with both markets pricing a rate cut in 2020 as the next action by the Fed.

In banking news, BB&T Corp. has agreed to buy SunTrust Banks Inc., which would be the world’s biggest bank merger in more than a decade. BB&T will own 57% of the new company, which hasn’t been named yet, and the combined bank will have approximately 60,000 employees and $440 billion in assets, making it the sixth-largest U.S. bank by assets. The new headquarters will be located in Charlotte, North Carolina.

Jason Haley
Managing Director, Investment Management Group
Date TimeEventSurveyActualPriorRevised
02/04/2019 10:00Factory Orders Released Live on Web
02/04/2019 10:00Factory Orders0.30%-0.60%-2.10%
02/04/2019 10:00Factory Orders Ex Trans-1.30%0.30%0.20%
02/04/2019 10:00Durable Goods Orders1.50%0.70%0.80%
02/04/2019 10:00Durables Ex Transportation0.00%-0.40%-0.30%
02/04/2019 10:00Cap Goods Orders Nondef Ex Air-0.10%-0.60%-0.60%
02/04/2019 10:00Cap Goods Ship Nondef Ex Air0.00%-0.20%-0.10%
02/05/2019 09:45Markit US Services PMI54.254.254.2
02/05/2019 09:45Markit US Composite PMI54.454.5
02/05/2019 10:00ISM Non-Manufacturing Index57.156.757.658
02/06/2019 07:00MBA Mortgage Applications-2.50%-3.00%
02/06/2019 08:30Productivity Release with Limited Data Due to Shutdown
02/06/2019 08:30Trade Balance Released Live on the Web
02/06/2019 08:30Nonfarm Productivity1.60%2.30%2.20%
02/06/2019 08:30Trade Balance-$54.0b-$49.3b-$55.5b-$55.7b
02/06/2019 08:30Unit Labor Costs1.70%0.90%
02/07/2019 08:30Initial Jobless Claims221k234k253k
02/07/2019 08:30Continuing Claims1733k1736k1782k1778k
02/07/2019 09:45Bloomberg Jan. United States Economic Survey
02/07/2019 09:45Bloomberg Consumer Comfort57.4
02/07/2019 15:00Consumer Credit$17.000b$22.149b