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Market Commentary


 

 
Today's Coupons
 
  10-Year Notes   99-26.5 (-08)  
 
  FN 3.5% Coupon   105-12 (-04.5)  
 
  Support   2.426%  
 
  Resistance   0.547%  
 
 
 
 
  Friday, May 15, 2020
 
 

Treasury Yields Drifted as Stocks Whipsawed

 
 
Market opened today’s session with treasuries slightly edging lower in the long end of the curve. 10-year Treasury yield is at 0.6298, 0.80 bp increased from prior closing of 0.6218.

Stocks fluctuated this morning after the data released today showed a record plunge in US retail sales. Trade tension between the US and China also continued to rise, dampening the investor sentiment even further. Yesterday’s comments from President Trump saying that he didn’t want to talk to China’s Xi and the US would save $500 billion if he cut off the whole relationship was followed by the Trump administration’s move to curtail semiconductor shipments to Chinese company Huawei. China responded that they would restrict or investigate US companies including Qualcomm, Cisco, and Apple if the US continued with this action. In the economic calendar, the headline Retail Sales in April displayed a far worse decline than expectation of -12.00% at -16.40%. Consumers did not appear to be using savings for the majority of their spending and the household savings rate had spiked, showing the deterioration in confidence that the current crisis would be temporary. Empire Manufacturing, on the other hand, improved to -48.50 from an all-time low of -78.20 prior. Despite the improvement, this reading still marked the second worst pace since 2001 which indicated that the recovery from the pandemic would be slow. Lastly, industrial Production in April also declined to -11.20% from a revised prior of -4.50% but University of Michigan Sentiment rose to 73.70 from prior of 71.80.

The curve has bear-steepened with UST 10-Year yield up 0.80 bp.

 
 
   
 
   
 
This Week's Events
 
 
  DATE EVENT TIME(PT) PERIOD SURVEY ACTUAL PRIOR REVISED  
  05/11 No Data - - - - - -  
                   
  05/12 NFIB Small Business Optimism 03:00 Apr 83.00 90.90 96.40 -  
                   
  05/12 CPI MoM 05:30 Apr -0.80% -0.80% -0.40% -  
                   
  05/12 CPI YoY 05:30 Apr 0.40% 0.30% 1.50% -  
                   
  05/12 CPI Index NSA 05:30 Apr 256.489 256.389 258.115 -  
                   
  05/12 CPI Core Index SA 05:30 Apr 266.110 265.601 266.795 -  
                   
  05/12 Real Avg Weekly Earnings YoY 05:30 Apr - 6.90% 0.70% 0.60%  
                   
  05/13 MBA Mortgage Applications 04:00 8 May - 0.30% 0.10% -  
                   
  05/13 PPI Final Demand MoM 05:30 Apr -0.50% -1.30% -0.20% -  
                   
  05/13 PPI Final Demand YoY 05:30 Apr -0.40% -1.20% 0.70% -  
                   
  05/14 Initial Jobless Claims 05:30 9 May 2500k 2981k 3169k 3176k  
                   
  05/14 Continuing Claims 05:30 2 May 25120k 22833k 22647k 22377k  
                   
  05/14 Import Price Index MoM 05:30 Apr -3.20% -2.60% -2.30% -2.40%  
                   
  05/14 Import Price Index YoY 05:30 Apr -7.40% -6.80% -4.10% -4.20%  
                   
  05/14 Export Price Index MoM 05:30 Apr -2.30% -3.30% -1.60% -1.70%  
                   
  05/14 Export Price Index YoY 05:30 Apr - -7.00% -3.60% -3.80%  
                   
  05/14 Bloomberg Consumer Comfort 06:45 10 May - 35.80 36.90 -  
                   
  05/15 Retail Sales Advance MoM 05:30 Apr -12.00% -16.40% -8.70% -8.30%  
                   
  05/15 Empire Manufacturing 05:30 May -60.00 -48.50 -78.20 -  
                   
  05/15 Capacity Utilization 06:15 Apr 63.80% 64.90% 72.70% 73.20%  
                   
  05/15 U. of Mich. Sentiment 07:00 Mar P 68.00 73.70 71.80 -
                   
 
 
 
 
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