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Market Commentary



 
Today's Coupons
 
  10-Year Notes   98-15.5 (-23)  
 
  FN 2.5% Coupon   104-22 (-06.5)  
 
  Support   1.026%  
 
  Resistance   0.780%  
 
 
 
 
  Tuesday, February 16, 2021
 
 

Treasury Yields Rise as the Empire Manufacturing Index Beats Expectations

 
 
Market opened today's session with treasuries lower across all maturities. 10-Year Treasury yield is at 1.2719, 6.37 bps increased from prior closing of 1.2082.

US stocks opened higher this morning as continued monetary support helped push riskier assets higher. While the S&P 500 has risen by 5% so far in 2021, debt markets continue to see a sell-off, with rates on 30 year debt moving to the highest point since February 2020. Elsewhere, Brent oil traded near a thirteen month high following a Texas power outage due to recent cold weather. Copper also moved to its highest level since 2012, as Citigroup forecasted the metal would rally on increased demand from countries other than china. Bitcoin pushed past $50,000 in a rally where Tesla Inc. recently purchased $1.5 trillion of the crypto currency. On the economic front, the Empire Manufacturing Index doubled expectations and nearly quadrupled prior results after reporting at 12.10 for the month of February. Notably, while today's figure demonstrates a high degree of confidence in future economic prospects, these prospects are expected to provide uneven results, with headwinds seen in  supply chain limitations due to the pandmeic, and microchip shortages which are expected to take a toll on the auto industry. Business optimism remains strong, as seen in an improving outlook of 31.90 to 34.90. Company inventories are expected to quicken over the next six months, providing further support for ongoing production. Reporting tomorrow are PPI Final Demand, Retail Sales, and Industrial Production, all reporting data for the month of January and expected at 0.40%, 1.10%, and 0.50%, respectively. MBA Mortgage Applications will also be reporting figures for the week ending February twelve.

The curve has bear-steepened with UST 10-Year yield up 6.37 bps.
 
 
   
 
   
 
This Week's Events
 
 
  DATE EVENT TIME(PT) PERIOD SURVEY ACTUAL PRIOR REVISED  
  02/16 Empire Manufacturing 05:30 Feb 6.00 12.10 3.50 -  
                   
  02/17 MBA Mortgage Applications 04:00 12 Feb - - -12.10% -  
                   
  02/18 Building Permits 05:30 Jan 1679k - 1709k 1704k  
                   
  02/18 Building Permits MoM 05:30 Jan -1.50% - 4.50% 4.20%  
                   
  02/18 Housing Starts 05:30 Jan 1660k - 1669k -  
                   
  02/18 Housing Starts MoM 05:30 Jan -0.60% - 5.80% -  
                   
  02/18 Initial Jobless Claims 05:30 13 Feb 770k - 793k -  
                   
  02/18 Continuing Claims 05:30 6 Feb 4450k - 4545k -  
                   
  02/18 Bloomberg Consumer Comfort 06:45 14 Feb - - 44.90 -  
                   
  02/19 Markit US Manufacturing PMI 06:45 Feb P 58.50 - 59.20 -  
                   
  02/19 Markit US Composite PMI 06:45 Feb P - - 58.70 -  
                   
  02/19 Markit US Services PMI 06:45 Feb P 57.90 - 58.30 -
                   
 
 
 
 
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  This information is provided solely for informational use and is not intended as an advice for trading or investment purposes in any manner whatsoever. Sun West Mortgage Company, Inc. is not a licensed or registered broker or dealer and cannot provide investment strategies or recommendations. This information is provided to licensed brokers/lenders only and may not be copied or distributed to customers or potential customers. All loans are subject to approval. Certain restrictions may apply. Listed pricing is a morning indication only. Program rates, prices, guidelines, fees, costs, terms and conditions are subject to change without notice.  
 
 
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