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Market Commentary


 
 
Today's Coupons
 
  10-Year Notes   106-18 (-15.5)  
 
  FN 3.5% Coupon   105-10 (-01)  
 
  Support   2.594%  
 
  Resistance   0.336%  
 
 
 
 
  Wednesday, March 25, 2020
 
 

Treasury Yields Lower after a Stimulus Deal Agreed

 
 
Market opened today’s session with treasuries rallying across all maturities. 10-Year Treasury yield is at 0.8019, 4.47 bps decreased from prior closing of 0.8466.

US stocks opened flat after recording the best rally in over a decade yesterday as investors awaited details on the blockbuster stimulus bill. A $2 trillion coronavirus stimulus bill was agreed between the White House and Congress overnight and is set for a vote later today. Today, the total confirmed cases surpassed 435,000 globally and the US confirmed over 55,000 cases. While President Trump commented that the US economy could reopen by Easter, California governor Newsom suggested that the state may have to remain in shutdown for eight to twelve weeks. Former Fed Chair Ben Bernanke made a remark today that the US economy will experience a sharp recession but should rebound quickly. He also added that the current situation is much closer to a major snowstorm than the Great Depression. The dollar fell for a second day versus its major peers and WTI crude also edged lower, trading below $24 a barrel this morning.

MBA mortgage applications plunged by the most since 2009. Applications decreased 29.40% after falling 8.40% in prior week. Both purchases and refinances declined 14.60% and 33.80% after falling 0.90% and 10.40% in prior week, respectively. The headline Durable Goods Orders rose to 1.20% from an upwardly revised prior of 0.10% vs. -0.90% consensus but the core declined below consensus of -0.40% to -0.60%. Lastly, FHFA House Price Index in January printed an increase of 0.30% vs. revised prior of 0.70% and 0.40% consensus. Later today, the US Treasury is scheduled to auction off $41 billion of 5-year notes.

The curve has bull-flattened with UST 10-Year yield down 4.47 bps.
 
 
   
 
   
 
This Week's Events
 
 
  DATE EVENT TIME(PT) PERIOD SURVEY ACTUAL PRIOR REVISED  
  03/23 Chicago Fed Nat Activity Index 05:30 Feb -0.35 0.16 -0.25 -0.33  
                   
  03/24 Markit US Manufacturing PMI 06:45 Mar P 43.50 49.20 50.70 -  
                   
  03/24 Markit US Services PMI 06:45 Mar P 42.00 39.10 49.40 -  
                   
  03/24 Markit US Composite PMI 06:45 Mar P - 40.50 49.60 -  
                   
  03/24 Richmond Fed Manufact. Index 07:00 Mar -13 2 -2 -  
                   
  03/25 MBA Mortgage Applications 04:00 20 Mar - -29.40% -8.40% -  
                   
  03/25 Durable Goods Orders 05:30 Feb P -0.90% 1.20% -0.20% 0.10%  
                   
  03/25 Durables Ex Transportation 05:30 Feb P -0.40% -0.60% 0.80% 0.60%  
                   
  03/25 FHFA House Price Index MoM 06:00 Jan 0.40% 0.30% 0.60% 0.70%  
                   
  03/26 Wholesale Inventories MoM 05:30 Feb P -0.20% - -0.40% -  
                   
  03/26 GDP Annualized QoQ 05:30 4Q T 2.10% - 2.10% -  
                   
  03/26 Personal Consumption 05:30 4Q T 1.70% - 1.70% -  
                   
  03/26 GDP Price Index 05:30 4Q T 1.30% - 1.30% -  
                   
  03/26 Core PCE QoQ 05:30 4Q T 1.20% - 1.20% -  
                   
  03/26 Initial Jobless Claims 05:30 21 Mar 1500k - 281k -  
                   
  03/26 Continuing Claims 05:30 14 Mar 1791k - 1701k -  
                   
  03/27 PCE Core Deflator MoM 05:30 Feb 0.20% - 0.10% -  
                   
  03/27 Personal Income 05:30 Feb 0.40% - 0.60% -  
                   
  03/27 Personal Spending 05:30 Feb 0.20% - 0.20% -  
                   
  03/27 PCE Deflator MoM 05:30 Feb 0.10% - 0.10% -  
                   
  03/27 PCE Deflator YoY 05:30 Feb 1.70% - 1.70% -  
                   
  03/27 U. of Mich. Sentiment 07:00 Mar F 89.50 - 95.90 -
                   
 
 
 
 
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