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Market Commentary


 
 
Today's Coupons
 
  10-Year Notes   99-20 (+07.5)  
 
  FN 3.5% Coupon   103-01 (00)  
 
  Support   2.784%  
 
  Resistance   1.721%  
 
 
 
 
  Wednesday, January 15, 2020
 
 

Treasury Yields Lower ahead of Trade Deal Signing

 
 
Market opened today’s session with treasuries rallying across all maturities. 10-year Treasury yield is at 1.7952, 1.57 bps decreased from prior closing of 1.8109.

US stock index futures slipped amid mixed corporate earnings in the early morning. Also, it was reported that the phase one trade deal with China which is scheduled to be signed in hours would leave the existing tariffs on billions of dollars of Chinese imports until at least November’s American presidential election which have dampened the risk appetite and pushed Treasuries north. However, mortgages underperformed versus Treasuries in the early morning ahead of signing of the trade deal. In corporate news, Target slumped in premarket after slashing its sales forecast and Goldman Sachs also missed analysts’ estimates. Bank of America, however, bounced back along with JPMorgan Chase with its trading revenue climbing 13%. Elsewhere, WTI crude drifted, trading slightly above $58 a barrel and gold nudged higher.

MBA mortgage applications index rose 30.20% after rising 13.50% in prior week which marked the largest increase in mortgage applications since January 2015. Both purchases and refinances increased 15.50% and 42.70% after rising 3.00% and 24.60% in prior week, respectively. The headline PPI in December edged higher to 0.10% from 0.00% prior but came in below consensus of 0.20%. The core also printed 0.10% vs. -0.20% prior and 0.20% consensus. Lastly, Empire Manufacturing in January surged to 4.80 from downwardly revised prior of 3.30 vs. 3.60 consensus. Later today, the Fed will release Beige Book at 11:00 AM (PT).

The curve has bull-flattened with UST 10-Year yield down 1.57 bps.

 
 
   
 
   
 
This Week's Events
 
 
  DATE EVENT TIME(PT) PERIOD SURVEY ACTUAL PRIOR REVISED  
  01/13 Monthly Budget Statement 11:00 Dec -$15.00b -13.30b -$13.50b -  
                   
  01/14 NFIB Small Business Optimism 03:00 Dec 104.60 102.70 104.70 -  
                   
  01/14 Real Avg Weekly Earnings YoY 05:30 Dec - 0.00% 1.10% 0.80%  
                   
  01/14 CPI MoM 05:30 Dec 0.30% 0.20% 0.30% -  
                   
  01/14 CPI YoY 05:30 Dec 2.40% 2.30% 2.10% -  
                   
  01/14 CPI Index NSA 05:30 Dec 257.169 256.974 257.208 -  
                   
  01/14 CPI Core Index SA 05:30 Dec 266.111 265.921 265.620 -  
                   
  01/15 MBA Mortgage Applications 04:00 10 Jan - 30.20% 13.50% -  
                   
  01/15 PPI Final Demand MoM 05:30 Dec 0.20% 0.10% 0.00% -  
                   
  01/15 PPI Final Demand YoY 05:30 Dec 1.30% 1.30% 1.10% -  
                   
  01/15 Empire Manufacturing 05:30 Jan 3.60 4.80 3.50 3.30  
                   
  01/16 Initial Jobless Claims 05:30 11 Jan 218k - 214k -  
                   
  01/16 Continuing Claims 05:30 4 Jan 1740k - 1803k -  
                   
  01/16 Retail Sales Advance MoM 05:30 Dec 0.30% - 0.20% -  
                   
  01/16 Import Price Index MoM 05:30 Dec 0.30% - 0.20% -  
                   
  01/16 Import Price Index YoY 05:30 Dec 0.50% - -1.30% -  
                   
  01/16 Export Price Index MoM 05:30 Dec 0.20% - 0.20% -  
                   
  01/16 Export Price Index YoY 05:30 Dec - - -1.30% -  
                   
  01/17 Building Permits 05:30 Dec 1460k - 1482k 1482k  
                   
  01/17 Building Permits MoM 05:30 Dec -1.50% - 1.40% 1.40%  
                   
  01/17 Housing Starts 05:30 Dec 1380k - 1365k -  
                   
  01/17 Housing Starts MoM 05:30 Dec 1.10% - 3.20% -  
                   
  01/17 Capacity Utilization 06:15 Dec 77.10% - 77.30% -  
                   
  01/17 U. of Mich. Sentiment 07:00 Jan P 99.30 - 99.30 -  
                   
  01/17 JOLTS Job Openings 07:00 Nov 7255 - 7267 -
                   
 
 
 
 
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