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Market Commentary


 
Today's Coupons
 
  10-Year Notes   102-06 (+07)  
 
  FN 3.5% Coupon   98-27 (+03.5)  
 
  Support   3.237%  
 
  Resistance   2.829%  
 
 
 
 
Monday, December 17, 2018
 
 
Market opened today’s session with treasuries rallying across all maturities. 10-Year treasury yield is at 2.8642, 2.53 bps decreased from prior closing of 2.8895.

US equity futures fell ahead of this year’s final FOMC meeting tomorrow. With their fourth rate hike of 2018 on the line at this meeting, Fed Chair Powell’s press conference will be closely watched for clues to policy next year. With this regard, President Trump tweeted this morning, slamming the Fed for “even considering” another rate hike since inflation is low and the dollar is strong. Aside from the FOMC meeting, the Bank of Japan and the Bank of England are also set to release their new monetary policies this Thursday. Lastly, a partial government shutdown will be imminent if President Trump and Congress fail to agree on funds for the border by this Friday.

We have a very light economic calendar today. December Empire Manufacturing Index fell to 10.90 vs. consensus of 20.00, pushing the treasury yields even further down. The data printed today was the lowest since May 2017 which reflects considerable uncertainty at year end. National Association of Home Builders market index also fell to 56.00 vs. 60.00 consensus which marks the lowest level since 2015 as the market struggles due to elevated housing prices and borrowing costs.

The curve has bull-flattened with UST 10-Year yield down 2.53 bps.
 
 
   
 
   
 
This Week's Events
 
 
  DATE EVENT TIME(PT) PERIOD SURVEY ACTUAL PRIOR REVISED  
  12/17 Empire Manufacturing 05:30 Dec 20.00 10.90 23.30 -  
                   
  12/17 NAHB Housing Market Index 07:00 Dec 60.00 56.00 60.00 -  
                   
  12/17 Total Net TIC Flows 13:00 Oct - - -$29.10b -  
                   
  12/17 Net Long-term TIC Flows 13:00 Oct - - $30.80b -  
                   
  12/18 Housing Starts 05:30 Nov 1226k - 1228k -  
                   
  12/18 Housing Starts MoM 05:30 Nov -0.20% - 1.50% -  
                   
  12/18 Building Permits 05:30 Nov 1260k - 1263k 1265k  
                   
  12/18 Building Permits MoM 05:30 Nov -0.40% - -0.60% -0.40%  
                   
  12/19 MBA Mortgage Applications 04:00 14 Dec - - 1.60% -  
                   
  12/19 Existing Home Sales 07:00 Nov 5.20m - 5.22m -  
                   
  12/19 Existing Home Sales MoM 07:00 Nov -0.40% - 1.40% -  
                   
  12/19 FOMC Rate Decision (Upper Bound) 11:00 19 Dec 2.50% - 2.25% -  
                   
  12/19 FOMC Rate Decision (Lower Bound) 11:00 19 Dec 2.25% - 2.00% -  
                   
  12/20 Philadelphia Fed Business Outlook 05:30 Dec 15.00 - 12.90 -  
                   
  12/20 Initial Jobless Claims 05:30 15 Dec 216k - 206k -  
                   
  12/20 Continuing Claims 05:30 8 Dec 1664k - 1661k -  
                   
  12/20 Bloomberg Consumer Comfort 06:45 16 Dec - - 59.40 -  
                   
  12/20 Leading Index 07:00 Nov 0.00% - 0.10% -  
                   
  12/21 GDP Annualized QoQ 05:30 3Q T 3.50% - 3.50% -  
                   
  12/21 Personal Consumption 05:30 3Q T 3.60% - 3.60% -  
                   
  12/21 GDP Price Index 05:30 3Q T 1.70% - 1.70% -  
                   
  12/21 Core PCE QoQ 05:30 3Q T 1.50% - 1.50% -  
                   
  12/21 Durable Goods Orders 05:30 Nov P 1.60% - -4.30% -  
                   
  12/21 Durables Ex Transportation 05:30 Nov P 0.30% - 0.20% -  
                   
  12/21 Personal Income 07:00 Nov 0.30% - 0.50% -  
                   
  12/21 Personal Spending 07:00 Nov 0.30% - 0.60% -  
                   
  12/21 U. of Mich. Sentiment 07:00 Dec F 97.50 - 97.50 -  
                   
  12/21 PCE Deflator MoM 07:00 Nov 0.00% - 0.20% -  
                   
  12/21 PCE Deflator YoY 07:00 Nov 1.80% - 2.00% -  
                   
  12/21 PCE Core MoM 07:00 Nov 0.20% - 0.10% -  
                   
  12/21 PCE Core YoY 07:00 Nov 1.90% - 1.80% -  
                   
  12/21 Kansas City Fed Manf. Activity 08:00 Dec 13.00 - 15.00 -  
                   
 
 
 
 
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