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Market Commentary



 
Today's Coupons
 
  10-Year Notes   101-24 (+11)  
 
  FN 3.5% Coupon   103-05.5 (+01)  
 
  Support   2.753%  
 
  Resistance   1.555%  
 
 
 
 
  Thursday, January 30, 2020
 
 

Treasury Yields Lower on Fears over Coronavirus

 
 
Market opened today’s session with treasuries rallying across all maturities. 10-Year Treasury yield is at 1.5684, 1.55 bps decreased from prior closing of 1.5839.

Stocks retreated and Treasuries rallied this morning on speculation that the deadly coronavirus could potentially rattle already-fragile global economic growth. China confirmed that the death toll has hit 170 with confirmed cases surpassing 7,700. Many suspect that the real number is much likely higher. The World Health Organization will decide today whether to declare the epidemic an international public health emergency. Airline and travel stocks dipped further in the premarket as the fear grew. Yesterday, the Fed decided to maintain the interest rates unchanged and the Fed Chair Powell commented on the virus that although it would likely damage the Chinese economy which can reverberate through others, it was too early to determine how much of an impact it will have on the US. As the earnings season continues, UPS, Facebook, and Verizon sank on their disappointing results. Amazon and Visa are due to report their results after the bell today. Elsewhere, WTI crude erased small gains from the past couple sessions as concern over the virus got heightened, trading below $53 a barrel this morning.

The fourth quarter GDP remained unchanged from prior reading of 2.10% above consensus of 2.00%. However, Personal Consumption and GDP Price index tumbled to 1.80% and 1.40% from prior readings of 3.20% and 1.80%, respectively. Underlying momentum in labor market appears to be remaining on track as Initial Jobless Claims came fairly in line with consensus of 215k at 216k, a 7k decline from an upwardly revised prior of 223k. Continuing Claims also dipped down to 1703k from an upwardly revised prior of 1747k vs 1730k consensus. Lastly, Bloomberg Consumer Comfort edged higher to 67.30 from 66.00 prior.

The curve has bull-flattened with UST 10-Year yield down 1.55 bps.
 
 
   
 
   
 
This Week's Events
 
 
  DATE EVENT TIME(PT) PERIOD SURVEY ACTUAL PRIOR REVISED  
  01/27 Dallas Fed ManfActivity 07:30 Jan -2.00 -0.20 -3.20 -  
                   
  01/28 Durable Goods Orders 05:30 Dec P 0.30% 2.40% -2.10% -3.10%  
                   
  01/28 Durables Ex Transportation 05:30 Dec P 0.30% -0.10% -0.10% -0.40%  
                   
  01/28 S&P CoreLogic CS 20-City MoM SA 06:00 Nov 0.40% 0.48% 0.43% 0.46%  
                   
  01/28 S&P CoreLogic CS 20-City YoY NSA 06:00 Nov 2.40% 2.55% 2.23% 2.22%  
                   
  01/28 Richmond Fed Manufact. Index 07:00 Jan -3.00 20.00 -5.00 -  
                   
  01/29 MBA Mortgage Applications 04:00 24 Jan - 7.20% -1.20% -  
                   
  01/29 Wholesale Inventories MoM 05:30 Dec P 0.10% -0.10% -0.10% 0.10%  
                   
  01/29 Pending Home Sales MoM 07:00 Dec 0.50% -4.90% 1.20% -  
                   
  01/29 Pending Home Sales NSA YoY 07:00 Dec 10.30% 6.80% 5.60% -  
                   
  01/29 FOMC Rate Decision (Upper Bound) 11:00 29 Jan 1.75% - 1.75% -  
                   
  01/29 FOMC Rate Decision (Lower Bound) 11:00 29 Jan 1.50% - 1.50% -  
                   
  01/30 Personal Consumption 05:30 4Q A 2.00% 1.80% 3.20% -  
                   
  01/30 Initial Jobless Claims 05:30 25 Jan 215k 216k 211k 223k  
                   
  01/30 Continuing Claims 05:30 18 Jan 1730k 1703k 1731k 1747k  
                   
  01/31 Personal Income 05:30 Dec 0.30% - 0.50% -  
                   
  01/31 Personal Spending 05:30 Dec 0.30% - 0.40% -  
                   
  01/31 PCE Deflator MoM 05:30 Dec 0.20% - 0.20% -  
                   
  01/31 PCE Deflator YoY 05:30 Dec 1.60% - 1.50% -  
                   
  01/31 U. of Mich. Sentiment 07:00 Jan F 99.10 - 99.10 -
                   
 
 
 
 
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