Thursday October 6

Stocks were for the most part flat leading up to the September NFP report. The S&P 500 rose less than 0.1% to 2,160 and the Dow Jones fell less than 0.1% to 18,268. Economic data showed that jobless claims fell to the lowest level since 1974, which indicates continued labor market strength. The KBW Bank index outperformed rising 0.2% on the day. On this backdrop the yield curve steepened, as the 2 year Treasury was flat at 0.85% and the 10 year rose 3bp to 1.74%. It’s important to note that while Treasuries have been selling off credit spreads have been tightening which is a good sign for markets. In accordance with higher yields, the US dollar put in a strong day as well. USD rose 0.5% to $1.1154. USD rose 0.5% against JPY to Y103.97. USD rose nearly 1.1% against GBP to $1.2615. Oil prices continued to rally. WTI closed 1.5% higher at $50.59 and Brent finished 1.5% higher at $52.65.

Snapchat is weighing a potential IPO that could value the app at around $25bn. This would be the biggest IPO since Alibaba received a $168bn valuation in 2014. As recently as May Snapchat was valued at a little under $17.8bn. The company has been breaking through its revenue forecasts this year, which was $60mm last year and is projected to top $1bn next year. The IPO market has been slow this year, however a well publicized and high profile IPO could be well received. Tech companies that have IPOd this year are so far up 65% collectively. The use of proceeds could potentially be to acquire new companies, as Snapchat has been looking into the augmented reality space. No banks have been hired yet to work on the deal according to reports.

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Thursday October 6

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