Yesterday the Fed announced its first rate cut in a decade as expected, but Fed Chairman Powell’s press conference following the FOMC meeting created significant volatility in the markets as he clumsily explained the trajectory of interest rates. Markets remained choppy overnight as investors continued to digest the Fed Chairman’s comments. However, treasuries have gained since the start of today’s session, with the 10-Yeartreasury yield slipping below 2% as traders shift their focus onto Friday’s U.S. employment reports while continuing to eye the ongoing earnings season. U.S. Stocks moved higher this morning after General Motors Co. earnings beat estimates, while Apple Inc. gained for a second day following its strong quarterly report. The dollar saw its biggest two-day rise, while West Texas oil fell below $57 a barrel.
On the economic calendar, we received the final print of the July Markit US Manufacturing PMI which saw a slight increase to 50.40 from 50.00 prior. ISM Manufacturing ticked lower to 51.20 from 51.70 prior, ISM Employment fell to 51.70 from 54.50 prior, ISM Prices Paid dropped to 45.10 from 47.90 prior, while ISM New Orders rose slightly higher to 50.80 from 50.00 prior. We also received the June Construction Spending which fell 1.30% month-over-month following a revised 0.50% decline in May. Lastly, we received the Initial Jobless claims for the week ended July 27th which rose 8k to 215k from a revised 207k the week prior. Continuing Claims jumped 22k to 1699k from a revised 1677k prior.
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Yesterday the Fed announced its first rate cut in a decade as expected, but Fed Chairman Powell’s press conference following the FOMC meeting created significant volatility in the markets as he clumsily explained the trajectory of interest rates. Markets remained choppy overnight as investors continued to digest the Fed Chairman’s comments. However, treasuries have gained since the start of today’s session, with the 10-Year treasury yield slipping below 2% as traders shift their focus onto Friday’s U.S. employment reports while continuing to eye the ongoing earnings season. U.S. Stocks moved higher this morning after General Motors Co. earnings beat estimates, while Apple Inc. gained for a second day following its strong quarterly report. The dollar saw its biggest two-day rise, while West Texas oil fell below $57 a barrel.
On the economic calendar, we received the final print of the July Markit US Manufacturing PMI which saw a slight increase to 50.40 from 50.00 prior. ISM Manufacturing ticked lower to 51.20 from 51.70 prior, ISM Employment fell to 51.70 from 54.50 prior, ISM Prices Paid dropped to 45.10 from 47.90 prior, while ISM New Orders rose slightly higher to 50.80 from 50.00 prior. We also received the June Construction Spending which fell 1.30% month-over-month following a revised 0.50% decline in May. Lastly, we received the Initial Jobless claims for the week ended July 27th which rose 8k to 215k from a revised 207k the week prior. Continuing Claims jumped 22k to 1699k from a revised 1677k prior.
The curve has bull-steepened with the UST 10-Year yield down 3.4 bps from prior closing.