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Today's Coupons
 
  10-Year Notes   105-01.5 (+15.5)  
 
  FN 3.5% Coupon   104-00 (-00.5)  
 
  Support   2.722%  
 
  Resistance   0.939%  
 
 
 
 
  Wednesday, March 4, 2020
 
 

Treasury Yields Lower as Equities Rally on Super Tuesday Primary Results

 
 
Market opened today’s session with treasuries rallying across all maturities. 10-Year Treasury yield is at 0.9715, 2.75 bps decreased from prior closing of 0.9990.

As the coronavirus has continued to dominate the market sentiment, equity market received fresh catalysts for a change from yesterday’s Super Tuesday primaries where Joe Biden reclaimed his position as a front runner for the Democratic presidential nomination, setting up a potential showdown for the nomination with Bernie Sanders who won California. Former Vice President’s remarkable comeback sparked a rally in the healthcare sector, leading today’s gains in equities. Treasury yields edged lower this morning with 10 year yields holding below 1% as investors awaited other top economies to follow the Fed’s emergency rate cut from yesterday. As widely forecasted, Bank of Canada followed the Fed’s decision and cut its benchmark interest rate by 50 basis points to 1.25% this morning. On the coronavirus front, the total confirmed cases now exceeded 94,000 with the death toll at 3,214. Also, 9 fatalities due to the virus have been reported in the US, all in Washington state. Elsewhere, WTI crude extended its rally, heading toward $48 a barrel this morning.

MBA mortgage applications index rose 15.10% after rising 1.5% in prior week. Purchase declined 2.70% but refinances surged 26.00% which is the highest level since May 2013 after rising 5.70% and falling 0.80% in prior week, respectively. ADP Employment Change in February printed an addition of 183k more jobs above consensus of 170k, showing no signs of slowing down due to the virus. Additionally, both Markit US Services PMI and Composite PMI came in line with prior readings of 49.40 and 49.60, respectively, and lastly, ISM Non-Manufacturing index in February increased to 57.30 from 55.50 prior vs. 54.80 consensus. Later today, the Fed will release Beige Book at 11:00 AM (PT).

The curve has bull-steepened with UST 10-Year yield down 2.75 bps.
 
 
   
 
   
 
This Week's Events
 
 
  DATE EVENT TIME(PT) PERIOD SURVEY ACTUAL PRIOR REVISED  
  03/02 Markit US Manufacturing PMI 06:45 Feb F 50.80 50.70 50.80 -  
                   
  03/02 Construction Spending MoM 07:00 Jan 0.60% 1.80% -0.20% 0.20%  
                   
  03/02 ISM Manufacturing 07:00 Feb 50.50 50.10 50.90 -  
                   
  03/02 ISM Prices Paid 07:00 Feb 50.80 45.90 53.30 -  
                   
  03/04 MBA Mortgage Applications 04:00 28 Feb - 15.10% 1.50% -  
                   
  03/04 ADP Employment Change 05:15 Feb 170K 183K 291K 209K  
                   
  03/04 Markit US Services PMI 06:45 Feb F 49.40 49.40 49.40 -  
                   
  03/04 Markit US Composite PMI 06:45 Feb F - 49.60 49.60 -  
                   
  03/05 Initial Jobless Claims 05:30 29 Feb 215K - 219K -  
                   
  03/05 Continuing Claims 05:30 22 Feb 1738K - 1724K -  
                   
  03/05 Bloomberg Consumer Comfort 06:45 1 Mar - - 63.50 -  
                   
  03/05 Factory Orders 07:00 Jan -0.10% - 1.80% -  
                   
  03/05 Durable Goods Orders 07:00 Jan F -0.20% - -0.20% -  
                   
  03/05 Durables Ex Transportation 07:00 Jan F - - 0.90% -  
                   
  03/06 Trade Balance 05:30 Jan -$46.40B - -$48.90B -  
                   
  03/06 Change in Nonfarm Payrolls 05:30 Feb 175K - 225K -  
                   
  03/06 Average Hourly Earnings MoM 05:30 Feb 0.30% - 0.20% -  
                   
  03/06 Average Hourly Earnings YoY 05:30 Feb 3.00% - 3.10% -  
                   
  03/06 Wholesale Inventories MoM 07:00 Jan F -0.20% - -0.20% -  
                   
  03/06 Wholesale Trade Sales MoM 07:00 Jan - - -0.70% -
                   
 
 
 
 
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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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