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Today's Coupons
 
  10-Year Notes   98-20.5 (+1-05.5)  
 
  FN 2.5% Coupon   104-18.5 (+10.5)  
 
  Support   0.749%  
 
  Resistance   0.599%  
 
 
 
 
  Wednesday, November 4, 2020
 
 

Treasury Yields Fall as The US Presidential Election Continues to be Tightly Contested

 
 
Market opened today's session with treasuries higher across all maturities. 10-Year Treasury yield is at 0.7662, 13.31 bps decreased from prior closing of 0.8993.
Stocks opened higher this morning as tech shares rallied and the US presidential election continues to be too-close-to-call. This upward move in equities comes after the market took a nosedive pre-market hours after Donald Trump falsely declared early victory and threatened to bring the supreme court into play. Additionally, with congress now predicted to continue staying divided, markets have tempered hopes that further stimulus will be injected into the economy. As of 3:00 AM (PT), Joe Biden continues in the lead with 238 electoral votes, while Donald Trump lags behind at 213 votes, both still very close to the 270 electoral college votes needed to win the presidency. Elsewhere, Uber and Lyft jumped following news California voters approved a proposition which would not force the tech giants to reclassify drivers as state employees. And on global news, Alibaba Group Holdings continued to fall as much as 7.5% as China stood behind it's decision to halt the IPO of Ant Group Co. WTI crude rose 2% while Gold weakened by 0.1%. On the economic front, MBA Mortgage Applications grew by 3.80% for week end October 30, double the growth seen in the week prior. Notably, purchases were down 1.30% while refi's rose by 6.40%. The average 30 year fixed rate stood at 3.01%. In regards to ADP Employment Change, the US significantly missed expectations of adding 643,000 jobs, reporting that it only managed to add 365,000 jobs for the month of October. With COVID cases on the rise and no additional fiscal stimulus in sight, firms have had to adjust their payrolls accordingly. Elsewhere, Trade Balance met expectations after reporting at -$63.90b. With imports up 0.5% and exports up 2.6%, the trade deficit narrowed in part thanks to China which saw its merchandise gap reduced to $24.30b with the US. Forward outlook on Trade Balance continues to be contingent on who takes office, with Joe Biden in favor of reinstating trade agreements, while Donald Trump continues to stand behind his America First policy, vowing to end the US's reliance on China. Coming up later this week, the Federal Reserve will present its policy decision on Thursday, while Nonfarm Payrolls will report on Friday.
The curve has bull-flattened with UST 10-Year yield down 13.31 bps.
 
 
   
 
   
 
This Week's Events
 
 
  DATE EVENT TIME(PT) PERIOD SURVEY ACTUAL PRIOR REVISED  
  11/02 ISM Prices Paid 07:00 Oct 61.50 65.50 62.80 -  
                   
  11/02 Construction Spending MoM 07:00 Sep 1.00% 0.30% 1.40% 0.80%  
                   
  11/03 Factory Orders 07:00 Sep 1.00% 1.10% 0.70% 0.60%  
                   
  11/03 Durable Goods Orders 07:00 Sep F 1.90% 1.90% 1.90% -  
                   
  11/03 Durables Ex Transportation 07:00 Sep F 0.80% 0.90% 0.80% -  
                   
  11/04 MBA Mortgage Applications 04:00 30 Oct - 3.80% 1.70% -  
                   
  11/04 ADP Employment Change 05:15 Oct 643k 365k 749k 753k  
                   
  11/04 Trade Balance 05:30 Sep -$63.90b -$63.90b -$67.10b -$67.00b  
                   
  11/04 Markit US Services PMI 06:45 Oct F 56.00 56.90 56.00 -  
                   
  11/04 Markit US Composite PMI 06:45 Oct F - 56.30 55.50 -  
                   
  11/05 Initial Jobless Claims 05:30 31 Oct 735k - 751k -  
                   
  11/05 Continuing Claims 05:30 24 Oct 7200k - 7756k -  
                   
  11/05 Bloomberg Consumer Comfort 06:45 1 Nov - - 46.30 -  
                   
  11/06 Change in Nonfarm Payrolls 05:30 Oct 600k - 661k -  
                   
  11/06 Average Hourly Earnings MoM 05:30 Oct 0.20% - 0.10% -  
                   
  11/06 Average Hourly Earnings YoY 05:30 Oct 4.50% - 4.70% -
                   
 
 
 
 
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  This information is provided solely for informational use and is not intended as an advice for trading or investment purposes 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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