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Market Commentary


 
Today's Coupons
 
  10-Year Notes   98-30 (+03)  
 
  FN 3.5% Coupon   99-28 (+02)  
 
  Support   3.237%  
 
  Resistance   2.625%  
 
 
 
 
Monday, March 04, 2019
 
 
Treasury Yields Lower as Trade Talks Near an End
 
 
Market opened today’s session with treasuries edging higher across all maturities. 10-Year treasury yield is at 2.7477, 0.54 bp decreased from prior closing of 2.7531.

Growing optimism on the trade revitalized equities last week and this week started off with same sentiment. US stocks advanced along with global stocks as a deal between the US and China could be on the horizon that may end American tariffs in return for Chinese concessions ranging from better protecting intellectual property rights to buying a significant amount of American products. However, the US wants the ability to re-impose tariffs if the concessions do not follow through. Over the weekend, President Trump resumed public criticism toward Fed Chair Powell again, referring him to “a gentleman that likes raising interest rates” despite of Powell’s recent dovish statements. Treasuries edged higher with the dollar, and WTI crude rallied above $56 a barrel this morning.

We have a very light calendar today. Construction Spending in December fell 0.60% from a 0.80% gain in November vs. consensus of a 0.10% increase. Both private and public constructions fell 0.60% after rising 1.30% and falling 1.00% in prior, respectively. We have Nonfarm payroll data released on Friday which will be closely monitored again as the Fed recently revealed that the path of its rate decision would be data dependent.

The curve has bull-flattened with UST 10-Year yield down 0.54 bp.
 
 
   
 
   
 
This Week's Events
 
 
  DATE EVENT TIME(PT) PERIOD SURVEY ACTUAL PRIOR REVISED  
  03/04 Construction Spending MoM 07:00 Dec 0.10% -0.60% 0.80% -  
                   
  03/05 Markit US Services PMI 06:45 Feb F 56.20 - 56.20 -  
                   
  03/05 Markit US Composite PMI 06:45 Feb F - - 55.80 -  
                   
  03/05 New Home Sales 07:00 Dec 598k - 657k -  
                   
  03/05 New Home Sales MoM 07:00 Dec -8.70% - 16.90% -  
                   
  03/05 Monthly Budget Statement 11:00 Jan $12.00b - -$13.50b -  
                   
  03/06 MBA Mortgage Applications 04:00 1 Mar - - 5.30% -  
                   
  03/06 ADP Employment Change 05:15 Feb 190k - 213k -  
                   
  03/06 Trade Balance 05:30 Dec -$57.90b - -$49.30b -  
                   
  03/06 U.S. Federal Reserve Releases Beige Book 11:00 - - - - -  
                   
  03/07 Challenger Job Cuts YoY 04:30 Feb - - 18.70% -  
                   
  03/07 Initial Jobless Claims 05:30 2 Mar 225k - 225k -  
                   
  03/07 Continuing Claims 05:30 23 Feb 1762k - 1805k -  
                   
  03/07 Nonfarm Productivity 05:30 4Q F 1.50% - 2.30% 2.20%  
                   
  03/07 Unit Labor Costs 05:30 4Q F 1.70% - 0.90% -  
                   
  03/07 Bloomberg Consumer Comfort 06:45 3 Mar - - 61.00 -  
                   
  03/08 Change in Nonfarm Payrolls 05:30 Feb 220k - 304k -  
                   
  03/08 Unemployment Rate 05:30 Feb 3.80% - 4.00% -  
                   
  03/08 Average Hourly Earnings MoM 05:30 Feb 0.30% - 0.10% -  
                   
  03/08 Average Hourly Earnings YoY 05:30 Feb - - 3.20% -  
                   
  03/08 Labor Force Participation Rate 05:30 Feb - - 63.20% -  
                   
  03/08 Wholesale Inventories MoM 07:00 Jan F - - - -  
                   
  03/08 Wholesale Trade Sales MoM 07:00 Jan - - - -  
                   
 
 
 
 
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