Considering the market just hiked the 10yr by 65bps over the past two weeks, I'd say a 25bps hike in the Fed funds rate is a rather moot point now. The next question the market will need to answer is 'when will they hike next?'
A lot has changed since the November 2nd FOMC statement - most notably the world has suddently become awesome again. The relatively benign statement (and election result) has left rate-hike odds at 100% for December but comment from Fischer and Yellen since have hinted concerns at the need for Trump fiscal spendfest. The main risk going in to the minutes was a dovish tilt for the future, tamping the current 'nothing can stop us now' attitude (and we note the dollar leaked lower into the release).
Anyone who has ever invested in distressed securities is intimately familiar with the many games that companies play to avoid a bankruptcy filing. The easiest game, and the most obvious red flag for investors to spot, involves stretching out payables and managing down receivable days to build cash so you can live to fight another day. While this may provide a temporary cash boost, it's typically the beginning of the end as vendors simply move payment terms to COD and the game quickly comes to an end.
For the 24th week of the last 26, oil rigs rose (by 2) to 474, the highest since January 2016. US crude production rose again last week tracking the lagged trend of rising rig counts in the US.
Notably US crude production looks set to rise given the rig count moves (and if OPEC agrees a deal and spooks prices higher, that production may well arrive sooner).
By EconMatters
We delve into Equities, Bonds, Commodities and The US Dollar in this video with what could be a likely catalyst for the next risk on move higher in risk based assets. A lot more than higher Oil Prices is riding on the OPEC Deal for a continuation of this Risk On Rally.
https://www.youtube.com/watch?v=ye0jM3VppY0