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Market Commentary


 
Today's Coupons
 
  10-Year Notes   98-01.5 (+02.5)  
 
  FN 3.5% Coupon   102-09.5 (+01.5)  
 
  Support   3.237%  
 
  Resistance   1.529%  
 
 
 
 
Tuesday, October 29, 2019
 
 
Treasury Yields Decline - National Security Council Director for European Affairs is Deposed in Impeachment Inquiry
 
 
Market opened today’s session with treasuries rallying across all maturities. The 10-Year Treasury yield is currently at 1.8367, 0.53 bps decreased from prior closing of 1.8420.

The S&P 500 dipped 0.10% at the open after tech giant Alphabet shares declined 1.00%. The Dow Jones and the Nasdaq Composite also slipped 0.10%. Alphabet’s declines were slightly offset by gains from pharmaceutical giants Merck and Pfizer; both stocks were up at least 1.00%. National Security Council Director for European Affairs, Alexander Vindman, arrived for a closed-door deposition at the US Capitol in Washington, DC to testify that he was a firsthand witness to Trump’s July 25th call with Ukraine President Volodymyr Zelensky. In that call, Trump asked Zelensky to “look into” unsubstantiated corruption allegations against former Vice President Joe Biden and his son Hunter Biden. Trump also asked Zelensky to do us a favor though and investigate whether Ukraine had been involved in foreign interference in the 2016 presidential election — a suspicion reportedly based on a conspiracy theory. In a statement released by Vindman, he remarked, “I was concerned by the call. I did not think it was proper to demand that a foreign government investigate a U.S. citizen, and I was worried about the implications for the U.S. government’s support of Ukraine.” House Democrats will hold a vote to push forward with the impeachment inquiry into President Donald Trump, House Speaker Nancy Pelosi confirmed Monday. The Trump administration has vowed not to comply with the impeachment probe. It has pressured some current and former officials not to appear for depositions, claiming immunity from the congressional process even after lawmakers have issued subpoenas for testimony. The yield on 10-Year Treasuries declined one basis point to 1.83%. Britain’s 10-Year yield fell one basis point to 0.709%. Germany’s 10-Year yield decreased two basis points to -0.35%. Australia’s 10-Year yield jumped nine basis points to 1.1855%.

A 40-day strike by the United Auto Workers union against General Motors cost the automaker about $3.8 billion for the year. The strike ended on Friday with ratification of a new contract for GM’s 48,000 union workers. The deal included pay raises, lump-sum bonuses and $11,000 ratification bonuses for most workers, among other benefits. Boeing CEO, Dennis Muilenburg, is scheduled to testify before a Senate panel, his first appearance before Congress since the crash of two 737 Max planes over the last year. The Senate Commerce committee hearing, scheduled for 10:00 AM (EST), is being held on the one-year anniversary of the first crash, Lion Air Flight 610 that went down in the Java Sea shortly after takeoff from Jakarta, Indonesia, killing all 189 people on board. Less than five months later, a Nairobi-bound Ethiopian Airlines 737 Max went down in Ethiopia, taking the lives of the 157 people on the flight. Boeing has developed software fixes for a flight-control system on board the planes that pilots said they didn’t know existed until after the first crash. Regulators haven’t yet signed off on those changes, but Muilenburg has previously said the plane should be flying by the end of the year. Boeing said it has flown more than 814 test flights with the new software.

The curve has bull-steepened with the UST 10-Year yield down 0.53 bps from prior closing.
 
 
   
 
   
 
This Week's Events
 
 
  DATE EVENT TIME(PT) PERIOD SURVEY ACTUAL PRIOR REVISED  
  10/28 Chicago Fed Nat Activity Index 05:30 Sep 0.00 -0.45 0.10 0.15  
                   
  10/28 Wholesale Inventories MoM 05:30 Sep P 0.20% -0.30% 0.20% 0.00%  
                   
  10/28 Dallas Fed ManfActivity 07:30 Oct 1.00 - 1.50 -  
                   
  10/29 S&P CoreLogic CS 20-City MoM SA 06:00 Aug -0.10% -0.16% 0.02% 0.04%  
                   
  10/29 S&P CoreLogic CS 20-City YoY NSA 06:00 Aug 2.10% 2.03% 2.00% 2.03%  
                   
  10/29 Pending Home Sales MoM 07:00 Sep 0.90% 1.50% 1.60% 1.40%  
                   
  10/29 Pending Home Sales NSA YoY 07:00 Sep 3.60% 6.30% 1.10% 1.00%  
                   
  10/30 MBA Mortgage Applications 04:00 25 Oct - - -11.90% -  
                   
  10/30 ADP Employment Change 05:15 Oct 110k - 135k -  
                   
  10/30 GDP Annualized QoQ 05:30 3Q A 1.60% - 2.00% -  
                   
  10/30 Personal Consumption 05:30 3Q A 2.60% - 4.60% -  
                   
  10/30 GDP Price Index 05:30 3Q A 1.90% - 2.40% -  
                   
  10/30 Core PCE QoQ 05:30 3Q A 2.20% - 1.90% -  
                   
  10/30 FOMC Rate Decision (Upper Bound) 11:00 30 Oct 1.75% - 2.00% -  
                   
  10/30 FOMC Rate Decision (Lower Bound) 11:00 30 Oct 1.50% - 1.75% -  
                   
  10/31 Challenger Job Cuts YoY 04:30 Oct - - -24.80% -  
                   
  10/31 Personal Income 05:30 Sep 0.30% - 0.40% -  
                   
  10/31 Personal Spending 05:30 Sep 0.30% - 0.10% -  
                   
  10/31 PCE Deflator MoM 05:30 Sep 0.00% - 0.00% -  
                   
  10/31 PCE Deflator YoY 05:30 Sep 1.40% - 1.40% -  
                   
  10/31 Initial Jobless Claims 05:30 26 Oct 215k - 212k -  
                   
  10/31 Continuing Claims 05:30 19 Oct 1679k - 1682k -  
                   
  10/31 Bloomberg Consumer Comfort 06:45 27 Oct - - 63.40 -  
                   
  11/01 Change in Nonfarm Payrolls 05:30 Oct 85k - 136k -  
                   
  11/01 Unemployment Rate 05:30 Oct 3.60% - 3.50% -  
                   
  11/01 Average Hourly Earnings MoM 05:30 Oct 0.30% - 0.00% -  
                   
  11/01 Average Hourly Earnings YoY 05:30 Oct 3.00% - 2.90% -  
                   
  11/01 Labor Force Participation Rate 05:30 Oct 63.10% - 63.20% -  
                   
  11/01 Markit US Manufacturing PMI 06:45 Oct F 51.50 - 51.50 -  
                   
  11/01 ISM Manufacturing 07:00 Oct 49.00 - 47.80 -  
                   
  11/01 ISM Prices Paid 07:00 Oct 50.00 - 49.70 -  
                   
  11/01 Construction Spending MoM 07:00 Sep 0.20% - 0.10% -
                   
 
 
 
 
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