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Market Commentary


 
Today's Coupons
 
  10-Year Notes   99-08.5 (+03.5)  
 
  FN 3.5% Coupon   99-02.5 (+02.5)  
 
  Support   3.111%  
 
  Resistance   2.813%  
 
 
 
 
Tuesday, July 31, 2018
 
 
Treasuries are higher across the curve this morning from yesterday's close. The UST 10-Year yield is currently at 2.955% after closing at 2.974% prior.

Treasuries rallied overnight and into the open after the Bank of Japan pledged to maintain its ultra-loose monetary policy unchanged and signaled to keep interest rates low for an “extended period of time”. Treasuries have pared some of its gains since as markets responded to headlines that the U.S. and China are attempting to resume trade talks to alleviate trade tensions. Conversely, U.S. Stocks have gained on the U.S. and China trade news. The two-day FOMC meeting is set to begin later today, with the Fed's announcement of its latest monetary policy decision available tomorrow.

On the economic calendar, we received the June Personal Income data which came in line with expectations at 0.40% gain following an unrevised 0.40% increase prior. Personal Spending also came in as expected at 0.40% gain month-over-month following an upwardly revised 0.50% rise in May. Moreover, the PCE Deflator showed a 0.10% increase in June following a 0.20% rise in May, with its YoY unchanged from a downwardly revised 2.20% prior. PCE Core rose 0.10% month-over-month as expected, while its YoY remained unchanged from a downwardly revised 1.90% prior. We also received the May Case-Shiller 20-City Home Composite Price Index which rose 0.20% month-over-month following a downwardly revised 0.16% increase prior.

The curve has bull-flattened with the UST 10-Year yield doen 1.9 bps from prior closing.
 
 
   
 
   
 
This Week's Events
 
 
  DATE EVENT TIME(PT) PERIOD SURVEY ACTUAL PRIOR REVISED  
  07/30 Pending Home Sales MoM 07:00 Jun 0.10% 0.90% -0.50% -  
                   
  07/30 Pending Home Sales NSA YoY 07:00 Jun - -4.00% -2.80% -  
                   
  07/30 Dallas Fed Manf. Activity 07:30 Jul 31.00 32.30 36.50 -  
                   
  07/31 Personal Income 05:30 Jun 0.40% 0.40% 0.40% -  
                   
  07/31 Personal Spending 05:30 Jun 0.40% 0.40% 0.20% 0.50%  
                   
  07/31 PCE Deflator MoM 05:30 Jun 0.10% 0.10% 0.20% -  
                   
  07/31 PCE Deflator YoY 05:30 Jun 2.30% 2.20% 2.30% 2.20%  
                   
  07/31 PCE Core MoM 05:30 Jun 0.10% 0.10% 0.20% -  
                   
  07/31 PCE Core YoY 05:30 Jun 2.00% 1.90% 2.00% 1.90%  
                   
  07/31 Employment Cost Index 05:30 2Q 0.70% 0.60% 0.80% -  
                   
  07/31 S&P CoreLogic CS 20-City MoM SA 06:00 May 0.20% 0.20% 0.20% 0.16%  
                   
  07/31 S&P CoreLogic CS 20-City YoY NSA 06:00 May 6.40% 6.51% 6.56% 6.69%  
                   
  08/01 MBA Mortgage Applications 04:00 27 Jul - - -0.20% -  
                   
  08/01 ADP Employment Change 05:15 Jul 186k - 177k -  
                   
  08/01 Markit US Manufacturing PMI 06:45 Jul F 55.50 - 55.50 -  
                   
  08/01 Construction Spending MoM 07:00 Jun 0.30% - 0.40% -  
                   
  08/01 ISM Manufacturing 07:00 Jul 59.30 - 60.20 -  
                   
  08/01 ISM Prices Paid 07:00 Jul 75.30 - 76.80 -  
                   
  08/01 FOMC Rate Decision (Upper Bound) 11:00 1 Aug 2.00% - 2.00% -  
                   
  08/01 FOMC Rate Decision (Lower Bound) 11:00 1 Aug 1.75% - 1.75% -  
                   
  08/02 Challenger Job Cuts YoY 04:30 Jul - - 19.60% -  
                   
  08/02 Initial Jobless Claims 05:30 28 Jul 220k - 217k -  
                   
  08/02 Continuing Claims 05:30 21 Jul 1750k - 1745k -  
                   
  08/02 Bloomberg Consumer Comfort 06:45 29 Jul - - 59.00 -  
                   
  08/02 Factory Orders 07:00 Jun 0.70% - 0.40% -  
                   
  08/02 Durable Goods Orders 07:00 Jun F - - 1.00% -  
                   
  08/02 Durables Ex Transportation 07:00 Jun F - - 0.40% -  
                   
  08/03 Trade Balance 05:30 Jun -$46.50b - -$43.10b -  
                   
  08/03 Change in Nonfarm Payrolls 05:30 Jul 190k - 213k -  
                   
  08/03 Unemployment Rate 05:30 Jul 3.90% - 4.00% -  
                   
  08/03 Average Hourly Earnings MoM 05:30 Jul 0.30% - 0.20% -  
                   
  08/03 Average Hourly Earnings YoY 05:30 Jul 2.70% - 2.70% -  
                   
  08/03 Labor Force Participation Rate 05:30 Jul - - 62.90% -  
                   
  08/03 Markit US Services PMI 06:45 Jul F 56.20 - 56.20 -  
                   
  08/03 Markit US Composite PMI 06:45 Jul F - - 55.90 -  
                   
 
 
 
 
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  This information is provided solely for informational use and is not intended as trading or investment advice in any manner whatsoever. Sun West Mortgage Company, Inc. is not a licensed or registered broker or dealer and cannot provide investment strategies or recommendations. This information is provided to licensed brokers/lenders only and may not be copied or distributed to customers or potential customers. All loans are subject to approval. Certain restrictions may apply. Listed pricing is a morning indication only. Program rates, prices, guidelines, fees, costs, terms and conditions are subject to change without notice  
 
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