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Market Commentary


 
Today's Coupons
 
  10-Year Notes   102-25 (+16.5)  
 
  FN 3.5% Coupon   102-05 (+05.5)  
 
  Support   3.237%  
 
  Resistance   2.062%  
 
 
 
 
Friday, June 07, 2019
 
 
Treasury Yields Lower Further on Disappointing Jobs Report
 
 
Market opened today’s session with treasuries advancing across all maturities. 10-Year Treasury yield is at 2.0637, 5.37 bps decreased from prior closing of 2.1174.

The odds of a potentially easier monetary policy from the Fed got increased by the weak jobs data in May. The yield on 2-Year Treasury notes headed down for a fifth weekly decline on the data, and stocks also advanced on the outlook of the interest rate path. With no new developments from the US-China trade negotiations, the talks between the US and Mexico will continue today to reach an agreement that would stop the 5.00% tariffs imposition which is set to become effective on Monday. Mexico offered to send 6,000 national guard troops to its southern border to stem the flow of undocumented migrants but Vice President Pence said the US would still proceed with the tariffs. In the UK, with the outlook of Brexit still remaining unclear, Prime Minister Theresa May stepped down as leader of the Conservative Party today. Elsewhere, WTI crude rebounded above $53 a barrel this morning.

Nonfarm Payrolls in May showed that the US added only 75,000 jobs, a drastic drop from a downwardly revised prior of 224k while consensus called for a 175k increase. The unemployment rate remained at 49-year low of 3.60% while wage growth stayed stagnant. Lastly, Wholesale Inventories in April slightly increased to 0.80% from 0.70% prior vs. 0.70% consensus.

The curve has bull-steepened with UST 10-Year yield down 5.37 bps.
 
 
   
 
   
 
This Week's Events
 
 
  DATE EVENT TIME(PT) PERIOD SURVEY ACTUAL PRIOR REVISED  
  06/03 Markit US Manufacturing PMI 06:45 May F 50.60 50.50 50.60 -  
                   
  06/03 ISM Manufacturing 07:00 May 53.00 52.10 52.80 -  
                   
  06/03 ISM Prices Paid 07:00 May 51.00 53.20 50.00 -  
                   
  06/03 Construction Spending MoM 07:00 Apr 0.40% 0.00% -0.90% 0.10%  
                   
  06/04 Factory Orders 07:00 Apr -1.00% -0.80% 1.90% 1.30%  
                   
  06/04 Durable Goods Orders 07:00 Apr F - -2.10% -2.10% -  
                   
  06/04 Durables Ex Transportation 07:00 Apr F - 0.00% 0.00% -  
                   
  06/05 MBA Mortgage Applications 04:00 31 May - 1.50% -3.30% -  
                   
  06/05 ADP Employment Change 05:15 May 185k 27k 275k 271k  
                   
  06/05 Markit US Services PMI 06:45 May F 50.90 50.90 50.90 -  
                   
  06/05 Markit US Composite PMI 06:45 May F - 50.90 50.90 -  
                   
  06/05

U.S. Federal Reserve Releases Beige

Book

11:00 May - - - -  
                   
  06/06 Challenger Job Cuts YoY 04:30 May - 85.90% 10.90% -  
                   
  06/06 Nonfarm Productivity 05:30 1Q F 3.50% 3.40% 3.60% -  
                   
  06/06 Unit Labor Costs 05:30 1Q F -0.90% -1.60% -0.90% -  
                   
  06/06 Initial Jobless Claims 05:30 1 Jun 215k 218k 215k 218k  
                   
  06/06 Continuing Claims 05:30 25 May 1660k 1682k 1657k 1662k  
                   
  06/06 Bloomberg Consumer Comfort 06:45 2 Jun - 61.7 60.80 -  
                   
  06/07 Unemployment Rate 05:30 May 3.60% 3.60% 3.60% -  
                   
  06/07 Average Hourly Earnings MoM 05:30 May 0.30% 0.20% 0.20% -  
                   
  06/07 Average Hourly Earnings YoY 05:30 May 3.20% 3.10% 3.20% -  
                   
  06/07 Labor Force Participation Rate 05:30 May - 62.80% 62.80% -  
                   
  06/07 Wholesale Inventories MoM 07:00 Apr F 0.70% 0.80% 0.70% -
                   
 
 
 
 
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