Daily Brief - 5 Jan 2024

Big bet on treasury yields spike ahead of jobs data

A trader has made a large, risky bet that US 10-year Treasury yields will jump to 4.15% by the end of Friday. This prediction is based on expectations of a strong US jobs report. Thursday's data showed increased hiring and fewer jobless claims, suggesting a healthy job market. If yields reach 4.20%, the trader could gain around $10 million. The bet was placed just before the December jobs report, and a strong report could impact Federal Reserve interest-rate decisions. Traders are especially interested in the upcoming data on US wages.

Citadel securities bolsters its team in Europe with top talent

Citadel Securities is expanding its European bond and rates trading teams by hiring senior traders in Paris and London. Key hires include Stefan Boyce from Bank of America for euro swaps trading and Sergio Colantuono from Nomura for European rates trading. The firm also recruited experts in sterling trading from BNP Paribas and HSBC. These moves are part of Citadel's broader growth in fixed income markets, driven by Shyam Rajan. Paris is becoming a key hub for trading talent post-Brexit, with Citadel and other firms establishing a stronger presence there.

Carrefour takes PepsiCo products off shelves in pricing tiff

Carrefour, a major French retailer, has removed PepsiCo products like soft drinks and Doritos from its stores in France. This drastic step is in response to what Carrefour deems 'unacceptable' price increases by PepsiCo. This clash is part of broader annual negotiations between grocers and food manufacturers. PepsiCo says it's been discussing prices with Carrefour for months and aims to keep talks constructive. The move reflects a wider trend of supermarkets challenging suppliers over price hikes and package size reductions. Similar disputes in the past have seen other major brands temporarily removed from store shelves.