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Market Commentary


 
Today's Coupons
 
  10-Year Notes   103-03 (+06)  
 
  FN 3.5% Coupon   102-05 (+03.5)  
 
  Support   3.237%  
 
  Resistance   1.975%  
 
 
 
 
Thursday, June 27, 2019
 
 
Treasury Yields Slightly Lower on Growing Optimism over US-China Trade
 
 
Market opened today’s session with treasuries inching higher across all maturities. 10-Year Treasury yield is at 2.0329, 1.39 bps decreased from prior closing of 2.0468.

Although a breakthrough is not expected at the meeting, investors’ optimism started growing that President Trump and Chinese President Xi will announce a new round of trade talks after their meeting at the G-20 summit this Saturday. With President Trump’s repeated threats of more tariffs contrasting with reports of a possible tariff pause, investors remained calm in today’s early session, also keeping a close eye on monetary policy expectations from central banks. In Europe, stocks and bonds fluctuated after data showed economic confidence in the region declined to the lowest level in nearly three years. In premarket, Boeing fell sharply after the FAA found an issue with its grounded 737 Max which must be addressed before lifting the national grounding order. Elsewhere, WTI crude erased some of its gains from the previous session, trading below $59 a barrel.

The first quarter GDP came in unchanged from prior reading of 3.10% while consensus called for 3.20%. Personal Consumption dropped to 0.90% from both prior and consensus of 1.30%. Initial Jobless Claims continued to display stability, printing slightly higher reading of 227k vs. 220k consensus, following an upwardly revised prior of 217k. Continuing Claims also edged higher to 1688k from an upwardly revised prior of 1666k vs. 1665k estimate. Bloomberg Consumer Comfort climbed to 63.60 from 61.80 prior, and lastly, Pending Home Sales in May increased to 1.10% from -1.50% prior vs. 1.00% consensus. Later today, the US Treasury is scheduled to auction off $40 billion of 4-week bills and $35 billion of 8-week bills at 8:30 AM (PT), and $32 billion of 7-year notes at 10:00 AM (PT).

The curve has bull-steepened with UST 10-Year yield down 1.39 bps.
 
 
   
 
   
 
This Week's Events
 
 
  DATE EVENT TIME(PT) PERIOD SURVEY ACTUAL PRIOR REVISED  
  06/24 Chicago Fed Nat Activity Index 05:30 May -0.20 -0.05 -0.45 -0.48  
                   
  06/24 Dallas Fed Manf. Activity 07:30 Jun -2.00 -12.10 -5.30 -  
                   
  06/25 FHFA House Price Index MoM 06:00 Apr 0.20% 0.40% 0.10% -  
                   
  06/25 S&P CoreLogic CS 20-City MoM SA 06:00 Apr 0.10% 0.00% 0.09% 0.32%  
                   
  06/25 S&P CoreLogic CS 20-City YoY NSA 06:00 Apr 2.50% 2.54% 2.68% 2.61%  
                   
  06/25 Richmond Fed Manufact. Index 07:00 Jun 2.00 3.00 5.00 -  
                   
  06/26 MBA Mortgage Applications 04:00 21 Jun - 1.30% -3.40% -  
                   
  06/26 Wholesale Inventories MoM 05:30 May P 0.50% 0.40% 0.80% 0.90%  
                   
  06/26 Durable Goods Orders 05:30 May P -0.30% -1.30% -2.10% -2.80%  
                   
  06/26 Durables Ex Transportation 05:30 May P 0.10% 0.30% 0.00% -0.10%  
                   
  06/27 GDP Annualized QoQ 05:30 1Q T 3.20% 3.10% 3.10% -  
                   
  06/27 Personal Consumption 05:30 1Q T 1.30% 0.90% 1.30% -  
                   
  06/27 GDP Price Index 05:30 1Q T 0.80% 0.90% 0.80% -  
                   
  06/27 Core PCE QoQ 05:30 1Q T 1.00% 1.20% 1.00% -  
                   
  06/27 Initial Jobless Claims 05:30 22 Jun 220k 227k 216k 217k  
                   
  06/27 Continuing Claims 05:30 15 Jun 1665k 1688k 1662k 1666k  
                   
  06/27 Bloomberg Consumer Comfort 06:45 23 Jun - 63.6 61.80 -  
                   
  06/27 Pending Home Sales MoM 07:00 May 1.00% 1.10% -1.50% -  
                   
  06/27 Pending Home Sales NSA YoY 07:00 May 0.40% -0.80% 0.40% -  
                   
  06/28 Personal Income 05:30 May 0.30% - 0.50% -  
                   
  06/28 Personal Spending 05:30 May 0.50% - 0.30% -  
                   
  06/28 PCE Deflator MoM 05:30 May 0.20% - 0.30% -  
                   
  06/28 PCE Deflator YoY 05:30 May 1.50% - 1.50% -  
                   
  06/28 U. of Mich. Sentiment 07:00 Jun F 98.00 - 97.90 -
                   
 
 
 
 
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