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Market Commentary


 
Today's Coupons
 
  10-Year Notes   103-25.5 (+07.5)  
 
  FN 3.5% Coupon   102-15 (+04)  
 
  Support   3.237%  
 
  Resistance   1.940%  
 
 
 
 
  Wednesday, July 3, 2019
 
 

Treasury Yields Hit New Low on Interest Rate Outlook

 
 
Market opened today's session with treasuries inching higher across all maturities. 10-Year Treasury yield is at 1.9446, 2.94 bps decreased from prior closing of 1.9740.

Today's disappointing data strengthened the case for lowering rates later this month, pushing both stocks and Treasuries up ahead of the Fourth of July holiday. The US benchmark yield dropped to the lowest level since November 2016 as investors also weighed the prospect of dovish appointees to the Federal Reserve and the ECB. President Trump said that he's planning to nominate Christopher Waller and Judy Shelton, whom many perceive to be advocates for easier monetary policy, to serve on the Fed board. Stocks also gained at the open this morning with Tesla Inc standing out as the company's record quarter for deliveries. WTI crude rebounded above $57 a barrel this morning after tumbling yesterday. Market will close early today at 11:00 AM (PT) and the US jobs report will be released Friday.

MBA Mortgage Applications index fell 0.10% after rising 1.30% in prior week. Purchases increased 1.10% and refinances fell 1.20% after falling 0.90% and rising 3.20% in prior week, respectively. ADP Employment Change in June came in below consensus of 140k at 102k, following an upwardly revised prior of 41k. Trade Deficit in May widened to $55.50 billion from revised prior of $51.20 billion. Initial Jobless Claims ticked down to 221k from an upwardly revised prior of 229k and Continuing Claims also dipped to 1686k, following an upwardly revised prior of 1694k. Factory Orders in May rose to -0.70% from a downwardly revised prior of -1.20%, and lastly, Durable Goods Orders came in line with both prior and consensus of -1.30%.

The curve has bull-flattened with UST 10-Year yield down 2.94 bps.
 
 
   
 
   
 
This Week's Events
 
 
  DATE EVENT TIME(PT) PERIOD SURVEY ACTUAL PRIOR REVISED  
  07/01 Markit US Manufacturing PMI 06:45 Jun F 50.10 50.60 50.10 -  
                   
  07/01 ISM Manufacturing 07:00 Jun 51.00 51.70 52.10 -  
                   
  07/01 ISM Prices Paid 07:00 Jun 53.00 47.90 53.20 -  
                   
  07/01 Construction Spending MoM 07:00 May 0.00% -0.80% 0.00% 0.40%  
                   
  07/02 No Data - - - - - -  
                   
  07/03 MBA Mortgage Applications 04:00 28 Jun - -0.10% 1.30% -  
                   
  07/03 Challenger Job Cuts YoY 04:30 Jun - 12.80% 85.90% -  
                   
  07/03 ADP Employment Change 05:15 Jun 140k 102k 27k 41k  
                   
  07/03 Trade Balance 05:30 May -$54.00b -55.50b -$50.80b -51.20b  
                   
  07/03 Initial Jobless Claims 05:30 29 Jun 223k 221k 227k 229k  
                   
  07/03 Continuing Claims 05:30 22 Jun 1675k 1686k 1688k 1694k  
                   
  07/03 Bloomberg Consumer Comfort 06:45 30 Jun - 62.60 63.60 -  
                   
  07/03 Markit US Services PMI 06:45 Jun F 50.70 51.50 50.70 -  
                   
  07/03 Markit US Composite PMI 06:45 Jun F - 51.50 50.60 -  
                   
  07/03 Durable Goods Orders 07:00 May F -1.30% -1.30% -1.30% -  
                   
  07/03 Factory Orders 07:00 May -0.60% -0.70% -0.80% -1.20%  
                   
  07/03 Durables Ex Transportation 07:00 May F - 0.40% 0.30% -  
                   
  07/04 No Data - - - - - -  
                   
  07/05 Unemployment Rate 05:30 Jun 3.60% - 3.60% -  
                   
  07/05 Average Hourly Earnings MoM 05:30 Jun 0.30% - 0.20% -  
                   
  07/05 Average Hourly Earnings YoY 05:30 Jun 3.20% - 3.10% -  
                   
  07/05 Labor Force Participation Rate 05:30 Jun 62.80% - 62.80% -
                   
 
 
 
 
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