US equity futures pointed to a mixed start as investors digested corporate earnings and the Fed’s dovish stance from the statement and conference from yesterday. GE came in lower than expected on their earnings but still rallied as revenue topped estimates, and Facebook also surged on strong revenue. However, both Microsoft and Tesla dipped after reporting quarterly results. Amazon which is scheduled to post results after the bell will be the one to watch today. Yesterday, the Fed kept the rates on hold as expected and signaled flexibility on its balance sheet normalization. Treasuries sharply rallied yesterday after the announcement and extended gain today as well. In Washington, as the trade negotiations wrap up, President Trump tweeted positive remarks on the meeting but also said that no final deal will be made until he meets with Chinese President Xi in the near future.
The fourth quarter Employment Cost Index fell to 0.70% from 0.80% prior vs. 0.80% estimate. Largely affected by the government shutdown, Initial Jobless Claims surged to 253k from an upwardly revised prior of 200k vs. 215k consensus, and Continuing Claims also jumped to 1782k from 1713k prior vs. 1721k consensus. Following the historic low reading from the last week on Initial Claims, this week’s claims data were particularly more disappointing which have driven treasuries up early this morning. Chicago Purchasing Manager report printed 56.70 vs. consensus of 61.50 and a downwardly revised prior of 63.80. Bloomberg Consumer Comfort came in unchanged from prior at 57.40. Lastly, New Home Sales surprisingly came in well above consensus of 570k at 657k as opposed to recent data indicating a slowdown in housing market.
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US equity futures pointed to a mixed start as investors digested corporate earnings and the Fed’s dovish stance from the statement and conference from yesterday. GE came in lower than expected on their earnings but still rallied as revenue topped estimates, and Facebook also surged on strong revenue. However, both Microsoft and Tesla dipped after reporting quarterly results. Amazon which is scheduled to post results after the bell will be the one to watch today. Yesterday, the Fed kept the rates on hold as expected and signaled flexibility on its balance sheet normalization. Treasuries sharply rallied yesterday after the announcement and extended gain today as well. In Washington, as the trade negotiations wrap up, President Trump tweeted positive remarks on the meeting but also said that no final deal will be made until he meets with Chinese President Xi in the near future.
The fourth quarter Employment Cost Index fell to 0.70% from 0.80% prior vs. 0.80% estimate. Largely affected by the government shutdown, Initial Jobless Claims surged to 253k from an upwardly revised prior of 200k vs. 215k consensus, and Continuing Claims also jumped to 1782k from 1713k prior vs. 1721k consensus. Following the historic low reading from the last week on Initial Claims, this week’s claims data were particularly more disappointing which have driven treasuries up early this morning. Chicago Purchasing Manager report printed 56.70 vs. consensus of 61.50 and a downwardly revised prior of 63.80. Bloomberg Consumer Comfort came in unchanged from prior at 57.40. Lastly, New Home Sales surprisingly came in well above consensus of 570k at 657k as opposed to recent data indicating a slowdown in housing market.
The curve has bull-flattened with UST 10-