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Market Commentary


 
Today's Coupons
 
  10-Year Notes   101-27.5 (+14.5)  
 
  FN 3.5% Coupon   101-27.5 (+05.5)  
 
  Support   3.237%  
 
  Resistance   2.149%  
 
 
 
 
Friday, May 31, 2019
 
 
Treasury Yields Renew Lows as Trade Outlook Dims
 
 
Market opened today’s session with treasuries rallying across all maturities. 10-Year Treasury yield is at 2.1679, 4.54 bps decreased from prior closing of 2.2133.

The US benchmark yield reached a new low since 2017 from the increasing demand in safe haven as the outlook of trade deals got even muddier. US stock futures pointed to steep losses, heading for the worst week since the global market rout in December last year. The latest move by President Trump which will impose 5.00% tariff on Mexican goods effective June 10th was one of the main market drivers this morning. President Trump warned that the levy could go as high as 25.00% in October if Mexico does not stop illegal immigrants entering the US. China, on the other hand, is reportedly preparing a major retaliation and progressing with plans to restrict rare-earths exports to the US. With the US Treasury yields tumbling; especially 10-year note yield dropping down to where it is now from 2.50% at the start of the month, the yield on German 10-year bund fell to -0.209% this morning, marking the lowest level ever. Elsewhere, WTI crude slumped below $56 a barrel this morning.

In today’s economic calendar, the April Personal Income rose 0.50% from 0.10% prior vs. 0.30% consensus. Personal Spending, however, dropped to 0.30% in April from an upwardly revised prior of 1.10%. MNI Chicago PMI in May came in slightly above consensus of 54.00 at 54.20, following 52.60 in April. Lastly, University of Michigan Sentiment dropped to 100.00 from 102.40 prior and 101.50 consensus. Later today, New York Fed President Williams will discuss monetary policy theory and practice at a conference event hosted at the New York Fed.

The curve has bull-steepened with UST 10-Year yield down 4.54 bps.
 
 
   
 
   
 
This Week's Events
 
 
  DATE EVENT TIME(PT) PERIOD SURVEY ACTUAL PRIOR REVISED  
  05/27 No Data - - - - - -  
                   
  05/28 FHFA House Price Index MoM 06:00 Mar 0.20% 0.10% 0.30% 0.40%  
                   
  05/28 S&P CoreLogic CS 20-City MoM SA 06:00 Mar 0.46% 0.09% 0.20% 0.26%  
                   
  05/28 S&P CoreLogic CS 20-City YoY NSA 06:00 Mar 2.50% 2.68% 3.00% 2.95%  
                   
  05/28 Dallas Fed ManfActivity 07:30 May 6.20 -5.30 2.00 -  
                   
  05/29 MBA Mortgage Applications 04:00 24 May - -3.30% 2.40% -  
                   
  05/29 Richmond Fed ManufactIndex 07:00 May 7.00 5.00 3.00 -  
                   
  05/30 GDP Annualized QoQ 05:30 1Q S 3.00% 3.10% 3.20% -  
                   
  05/30 Wholesale Inventories MoM 05:30 Apr P 0.10% 0.70% -0.10% 0.00%  
                   
  05/30 Personal Consumption 05:30 1Q S 1.20% 1.30% 1.20% -  
                   
  05/30 GDP Price Index 05:30 1Q S 0.90% 0.80% 0.90% -  
                   
  05/30 Core PCE QoQ 05:30 1Q S 1.30% 1.00% 1.30% -  
                   
  05/30 Initial Jobless Claims 05:30 25 May 214k 215k 211k 212k  
                   
  05/30 Continuing Claims 05:30 18 May 1662k 1657k 1676k 1683k  
                   
  05/30 Bloomberg Consumer Comfort 06:45 26 May - 60.80 60.30 -  
                   
  05/30 Pending Home Sales MoM 07:00 Apr 0.50% -1.50% 3.80% 3.90%  
                   
  05/30 Pending Home Sales NSA YoY 07:00 Apr 0.10% 0.40% -3.20% -3.10%  
                   
  05/31 Personal Income 05:30 Apr 0.30% 0.50% 0.10% -  
                   
  05/31 Personal Spending 05:30 Apr 0.20% 0.30% 0.90% 1.10%  
                   
  05/31 PCE Deflator MoM 05:30 Apr 0.30% 0.30% 0.20% -  
                   
  05/31 PCE Deflator YoY 05:30 Apr 1.60% 1.50% 1.50% 1.40%  
                   
  05/31 U. of MichSentiment 07:00 May F 101.50 100.00 102.40 -
                   
 
 
 
 
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