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Market Commentary


 
Today's Coupons
 
  10-Year Notes   98-01.5 (-12)  
 
  FN 3.5% Coupon   98-06 (-06.5)  
 
  Support   3.111%  
 
  Resistance   2.810%  
 
 
 
 
Wednesday, October 03, 2018
 
 
Treasuries are lower across the curve this morning from yesterday’s close. The UST 10-Year yield is currently at 3.094% after closing at 3.064% prior.

Treasuries lowered overnight as investor jitters faded on news that the Italian government could potentially revise its budget plan to lower its deficit target. The original proposed plan was announced last Friday and revealed that the Italian government agreed to a budget deficit of 2.40% through 2021. The revised plan will look to lower the deficit target to 2.20% in 2020 and down to 2.00% in 2021. Treasuries fell further this morning after the September ADP Employment Change showed a strong gain in private jobs. The labor market remains very tight as the ADP employment rose 230k in September following an upwardly revised 168k gain in August; consensus called for 184k increase. U.S. stocks rose and the dollar gained on the upbeat private jobs data.

MBA Mortgage Applications for the week ended September 28 was little changed and rose just 0.03% after rising 2.90% the week prior. Purchase applications were up 0.10% for the week following a 2.60% increase prior, while refinancing activities showed a slight drop of 0.10% after increasing 3.20% the week prior. Also on the calendar, we received the final September print of the Markit US Services PMI which beat expectations at 53.50 versus 53.00 per consensus. Markit US Composite PMI was revised higher to 53.90 from 53.40 prior. Lastly, we received the September ISM Non-Manufacturing Index which came in higher than expected at 61.60 versus 58.00 per consensus. Several Fed Officials are scheduled to speak today including Fed Evans, Fed Barkin, Fed Brainard, Fed Mester, and Fed Chairman Powell.

The curve has bear-steepened with the UST 10-Year yield up 3.0 bps from prior closing.
 
 
   
 
   
 
This Week's Events
 
 
  DATE EVENT TIME(PT) PERIOD SURVEY ACTUAL PRIOR REVISED  
  10/01 Markit US Manufacturing PMI 06:45 Sep F 55.60 55.60 55.60 -  
                   
  10/01 Construction Spending MoM 07:00 Aug 0.40% 0.10% 0.10% 0.20%  
                   
  10/01 ISM Manufacturing 07:00 Sep 60.00 59.80 61.30 -  
                   
  10/01 ISM Prices Paid 07:00 Sep 71.40 66.90 72.10 -  
                   
  10/02 No Data - - - - - -  
                   
  10/03 MBA Mortgage Applications 04:00 28 Sep - 0.03% 2.90% -  
                   
  10/03 ADP Employment Change 05:15 Sep 184k 230k 163k 168k  
                   
  10/03 Markit US Services PMI 06:45 Sep F 53.00 53.50 52.90 -  
                   
  10/03 Markit US Composite PMI 06:45 Sep F - 53.90 53.40 -  
                   
  10/04 Challenger Job Cuts YoY 04:30 Sep - - 13.70% -  
                   
  10/04 Initial Jobless Claims 05:30 29 Sep 215k - 214k -  
                   
  10/04 Continuing Claims 05:30 22 Sep 1665k - 1661k -  
                   
  10/04 Bloomberg Consumer Comfort 06:45 30 Sep - - 61.20 -  
                   
  10/04 Factory Orders 07:00 Aug 2.10% - -0.80% -  
                   
  10/04 Durable Goods Orders 07:00 Aug F 4.50% - 4.50% -  
                   
  10/04 Durables Ex Transportation 07:00 Aug F - - 0.10% -  
                   
  10/05 Trade Balance 05:30 Aug -$53.50b - -$50.10b -  
                   
  10/05 Change in Nonfarm Payrolls 05:30 Sep 181k - 201k -  
                   
  10/05 Unemployment Rate 05:30 Sep 3.80% - 3.90% -  
                   
  10/05 Average Hourly Earnings MoM 05:30 Sep 0.30% - 0.40% -  
                   
  10/05 Average Hourly Earnings YoY 05:30 Sep 2.80% - 2.90% -  
                   
  10/05 Labor Force Participation Rate 05:30 Sep 62.70% - 62.70% -  
                   
 
 
 
 
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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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