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Market Commentary


 
Today's Coupons
 
  10-Year Notes   101-17.5 (+06)  
 
  FN 3.5% Coupon   98-15 (+04.5)  
 
  Support   3.237%  
 
  Resistance   2.939%  
 
 
 
 
Tuesday, December 04, 2018
 
 
Treasuries are slightly higher across the curve this morning from yesterday’s close. The UST 10-Year yield is currently at 2.954% after closing at 2.971% prior.

Treasuries extended yesterday’s gains during the overnight session as the benchmark 10-year yield slipped to session lows below 2.960%. The yield curve continued to flatten which saw the yield spread between 3 and 5-year yields inverted for the first time since 2007. In addition to the central bank’s recent dovish tone, the yield curve inversion could potentially be foreshadowing the end of the Fed’s tightening path. In equities, the rally sparked by the trade truce between U.S. and China dissipated overnight as investors grew skeptical that the two countries made any meaningful progress. Elsewhere, oil extended its rebound and advanced for a second day as West Texas Intermediate crude climbed as much as 1.4 percent to over $53.70 a barrel.

There are no available reports on today’s economic calendar. Additionally, the U.S. financial markets will be closed on Wednesday for a national day of mourning to honor former U.S. President George H.W. Bush. As a result, Fed Chairman Powell’s scheduled testimony to Congress for Wednesday has been canceled. Still to come this week, the latest version of the Fed’s Beige Book will be released tomorrow along with the MBA Mortgage Applications for the week ended November 30. Thursday will feature the October Trade Balance, 3Q Nonfarm Productivity and Unit Labor Costs as well as the October Factory Orders and Durable Goods Orders. Then on Friday, we will have the monthly U.S. employment reports for November.

The curve has bull-flattened with the UST 10-Year yield down 1.7 bps from prior closing.
 
 
   
 
   
 
This Week's Events
 
 
  DATE EVENT TIME(PT) PERIOD SURVEY ACTUAL PRIOR REVISED  
  12/03 Markit US Manufacturing PMI 06:45 Nov F 55.40 55.30 55.40 -  
                   
  12/03 Construction Spending MoM 07:00 Oct 0.40% -0.10% 0.00% -0.10%  
                   
  12/03 ISM Manufacturing 07:00 Nov 57.50 59.30 57.70 -  
                   
  12/03 ISM Prices Paid 07:00 Nov 70.00 60.70 71.60 -  
                   
  12/04 No Data - - - - - -  
                   
  12/05 MBA Mortgage Applications 04:00 30 Nov - - 5.50% -  
                   
  12/05 ADP Employment Change 05:15 Nov 195k - 227k -  
                   
  12/05 Nonfarm Productivity 05:30 3Q F 2.30% - 2.20% -  
                   
  12/05 Unit Labor Costs 05:30 3Q F 1.00% - 1.20% -  
                   
  12/05 Markit US Services PMI 06:45 Nov F 54.40 - 54.40 -  
                   
  12/05 Markit US Composite PMI 06:45 Nov F - - 54.40 -  
                   
  12/05 U.S. Federal Reserve Releases Beige Book 11:00 - - - - -  
                   
  12/06 Challenger Job Cuts YoY 04:30 Nov - - 153.60% -  
                   
  12/06 Trade Balance 05:30 Oct -$55.00b - -$54.00b -  
                   
  12/06 Initial Jobless Claims 05:30 1 Dec 225k - 234k -  
                   
  12/06 Continuing Claims 05:30 24 Nov 1695k - 1710k -  
                   
  12/06 Bloomberg Consumer Comfort 06:45 2 Dec - - 60.60 -  
                   
  12/06 Factory Orders 07:00 Oct -2.00% - 0.70% -  
                   
  12/06 Durable Goods Orders 07:00 Oct F -2.40% - -4.40% -  
                   
  12/06 Durables Ex Transportation 07:00 Oct F 0.10% - 0.10% -  
                   
  12/07 Change in Nonfarm Payrolls 05:30 Nov 198k - 250k -  
                   
  12/07 Unemployment Rate 05:30 Nov 3.70% - 3.70% -  
                   
  12/07 Average Hourly Earnings MoM 05:30 Nov 0.30% - 0.20% -  
                   
  12/07 Average Hourly Earnings YoY 05:30 Nov 3.10% - 3.10% -  
                   
  12/07 Labor Force Participation Rate 05:30 Nov 62.90% - 62.90% -  
                   
  12/07 Wholesale Inventories MoM 07:00 Oct F 0.70% - 0.70% -  
                   
  12/07 Wholesale Trade Sales MoM 07:00 Oct - - 0.20% -  
                   
  12/07 U. of Mich. Sentiment 07:00 Dec P 97.00 - 97.50 -  
                   
 
 
 
 
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