Bond prices moved little on Monday despite a strong day in the stock market. Bond market rumors focused on heavy losses at Citigroup. This morning, those rumors were mostly confirmed with the bank's announced fourth quarter loss which was dominated by a $17.4 billion subprime charge. Citi will cut its dividend 41% and will issue another $14.5 billion in preferred stock. Merrill is receiving a $6.6 billion infusion from a consortium of foreign investors. Earnings announcements will dot the landscape for the next several weeks. This morning, bond prices are a bit higher and have shown little reaction to the morning's economic reports. December retail sales fell 0.4% versus expectations of a 0.1% decline. PPI fell 0.1% in December while the core rate rose 0.2%. The Empire Manufacturing index came in at 9.0, a touch below estimates. Former Fed Chairman signed on with a hedge-fund firm, seemingly completing his transition to the private sector

 

FNMA 5.5% February Coupon

Currently UP 7+/32'S

 

Current Indices

Index	Today	Yesterday	Month Ago			Year Ago
Fannie Mae 6 Note	5.07	5.10	5.58			5.72
1 Month Libor	4.022	4.081	4.965			5.320
6 Month Libor	3.827	3.853	4.848			5.385
1 Year Libor	3.473	3.496	4.518			5.383
5 Year Treasury	3.318	3.369	3.884			4.865
10 Year Treasury	4.041	4.095	4.460			5.069