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Market Commentary



 
Today's Coupons
 
  10-Year Notes   108-17.5 (+05)  
 
  FN 3.5% Coupon   105-21 (+03)  
 
  Support   2.541%  
 
  Resistance   0.547%  
 
 
 
 
  Wednesday, April 29, 2020
 
 

Treasury Yields Slightly Fall as Stocks climb on Virus Treatment Hopes

 
 
Market opened today’s session with treasuries edging higher across all maturities. 10-Year Treasury yield is at 0.5907, 2.22 bps decreased from prior closing of 0.6129.

US stocks rallied this morning amid renewed hopes for a potential virus treatment from Gilead Sciences despite the biggest economic contraction since 2008 in the first quarter. The annualized GDP in the first quarter sharply fell to -4.80% from a prior data of 2.10%, officially ending the record-long economic expansion and marking the first contraction since 2014. MBA mortgage applications index fell 3.30% after falling 0.30% in prior week. Purchases surprisingly increased 11.60% and refinances fell 7.30% after rising 2.10% and falling 0.80% in prior week, respectively. Personal Consumption and Pending Home Sales data also fell beyond expectations of -3.60% and -13.60% at -7.60% and -20.80%, respectively. Later today, FOMC rate decision will be announced at 11:00 AM (PT). With interest rates already close to zero, and many measures to cushion the economic fallout announced since the last FOMC meeting, there are low expectations for major action from the Fed. However, there will also be a press conference with Chairman Powell who may give more forward guidance on how long rates will stay at their current low levels. Treasuries gained this morning and the dollar slipped. In corporate news, Microsoft, Facebook and Tesla are among the companies that are scheduled to release its first quarter earnings results later today.  Elsewhere, WTI crude extended gains, trading above $15 a barrel this morning.

The curve has bull-flattened with UST 10-Year yield down 2.22 bps.
 
 
   
 
   
 
This Week's Events
 
 
  DATE EVENT TIME(PT) PERIOD SURVEY ACTUAL PRIOR REVISED  
  04/27 Dallas Fed Manf. Activity 07:30 Apr -75.00 -73.70 -70.00 -  
                   
  04/28 Wholesale Inventories MoM 05:30 Mar P -0.40% -1.00% -0.70% -0.60%  
                   
  04/28 S&P CoreLogic CS 20-City MoM SA 06:00 Feb 0.35% 0.45% 0.30% 0.35%  
                   
  04/28 S&P CoreLogic CS 20-City YoY NSA 06:00 Feb 3.19% 3.47% 3.08% 3.12%  
                   
  04/28 Richmond Fed Manufact. Index 07:00 Apr -41 -53 2 -  
                   
  04/29 MBA Mortgage Applications 04:00 24 Apr - -3.30% -0.30% -  
                   
  04/29 GDP Annualized QoQ 05:30 1Q A -4.00% -4.80% 2.10% -  
                   
  04/29 Personal Consumption 05:30 1Q A -3.60% -7.60% 1.80% -  
                   
  04/29 GDP Price Index 05:30 1Q A 1.00% 1.30% 1.30% -  
                   
  04/29 Core PCE QoQ 05:30 1Q A 1.70% 1.80% 1.30% -  
                   
  04/29 FOMC Rate Decision (Upper Bound) 11:00 29 Apr 0.25% - 0.25% -  
                   
  04/29 FOMC Rate Decision (Lower Bound) 11:00 29 Apr 0.00% - 0.00% -  
                   
  04/30 Initial Jobless Claims 05:30 25 Apr 3500k - 4427k -  
                   
  04/30 Continuing Claims 05:30 18 Apr 19238k - 15976k -  
                   
  04/30 PCE Core Deflator MoM 05:30 Mar -0.10% - 0.20% -  
                   
  04/30 Personal Income 05:30 Mar -1.50% - 0.60% -  
                   
  04/30 Personal Spending 05:30 Mar -5.00% - 0.20% -  
                   
  04/30 PCE Deflator MoM 05:30 Mar -0.30% - 0.10% -  
                   
  04/30 PCE Deflator YoY 05:30 Mar 1.30% - 1.80% -  
                   
  05/01 Markit US Manufacturing PMI 06:45 Apr F 36.70 - 36.90 -
                   
 
 
 
 
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