The Day Ahead: Quiet Overnight Session, EU Headlines Prevail. 3yr Auction Today

Morning/Overnight News

• Fairly quiet overnight session.  Volumes below average.
  
• Bond markets slightly lower and equities slightly higher as "risk-off" unwinds a bit
• Eurozone wants written commitment from new Greece leadership, then would sign off on 6th bailout Tranche
• Greece still trying to decide on new Prime Minister.  Papademos (former ECB Pres) Technocracy remains most likely
• Markets to Stay Transfixed on Italian Bonds Tuesday (CNBC)
• European Bank Exposure to Risky Mortgage Assets (The Big Picture)
• Volcker: Three years later, Unfinished Business In Financial Reform (The Big Picture)
• Mortgage Rates Unchanged to Slightly Improved (Mortgage News Daily)
• Cash-Out Refinancing at New Lows in Volume, Value (Mortgage News Daily)
• FHFA cautions against full privatization (NAFCU)
• Video: Pandit Says Shadow Banking Needs More Regulation (Bloomberg)

Economic Calendar

07:45 ICSC chain stores ww (w/e)
07:45 ICSC chain stores yy (w/e)
08:55 Redbook mm (w/e)
08:55 Redbook yy (w/e)
10:00 IBD economic optimism (Nov)
11:30 4-Week Bill Auction
13:00 3-Yr Note Auction
15:30 API weekly crude stocks (w/e)
15:30 API weekly gasoline stk (w/e)
15:30 API weekly dist. stocks (w/e)

Markets

Overnight trading levels stayed largely within the extremes of Monday's domestic session.  10yr yilds hit 2.06 just before the domestic open and were as low as 2.0 overnight.  S&P Futures were generally slightly more bullish have moved up from a 1250 low to 1265 currently.  Apart from EU headlines, the only major mover on today's calendar is the 1pm 3yr Note Auction.