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Market Commentary

Market Commentary

Today's Coupons
  10-Year Notes   103-07 (-09)  
  FN 3.5% Coupon   99-21.5 (-03.5)  
  Support   3.237%  
  Resistance   2.543%  
Friday, January 25, 2019
Market opened today’s session with treasuries declining across all maturities. 10-Year treasury yield is at 2.7441, 2.84 bps increased from prior closing of 2.7157.

Intel reported fourth quarter earnings above expectations but missed on revenue after the close yesterday. Stocks rallied this morning, however, as investors looked past it and weighed more on potential resolutions to both the shutdown and the trade war. Although the Senate rejected two bills that could have potentially ended the shutdown yesterday, new negotiations between the two parties have begun which can possibly reach a bipartisan compromise. As the government shutdown entered its 35th day, many federal employees will miss their second paychecks today, and Durable Goods Orders and New Home Sales data will be postponed, hampering the normal flow of economic data. There will be no data released today. On the trade front, another round of negotiations will take place between the US and China from Jan 30 to Jan 31 in Washington. Also next week, the two-day FOMC meeting will be held from the 29th to the 30th with the rate decision to be announced on the second day. Investors will focus on the tone of their statement and the press conference with Fed Chair Powell since there has been news regarding the Fed perhaps nearing to an end of their balance sheet reduction. Treasuries sold-off and the dollar weakened this morning.

The curve has bear-steepened with UST 10-Year yield up 2.84 bps.

This Week's Events
  01/21 No Data - - - - - -  
  01/22 Existing Home Sales 07:00 Dec 5.24m 4.99m 5.32m 5.33m  
  01/22 Existing Home Sales MoM 07:00 Dec -1.50% -6.40% 1.90% 2.10%  
  01/23 MBA Mortgage Applications 04:00 18 Jan - -2.70% 13.50% -
  01/23 FHFA House Price Index MoM 06:00 Nov 0.30% 0.40% 0.30% 0.40%  
  01/23 Richmond Fed Manufact. Index 07:00 Jan -2.00 -2.00 -8.00 -  
  01/24 Initial Jobless Claims 05:30 19 Jan 218k 199k 213k 212k  
  01/24 Continuing Claims 05:30 12 Jan 1730k 1713k 1737k -  
  01/24 Bloomberg Consumer Comfort 06:45 20 Jan - 57.40 58.10 -  
  01/24 Markit US Composite PMI 06:45 Jan P - 54.50 54.40 -  
  01/24 Markit US Manufacturing PMI 06:45 Jan P 53.50 54.90 53.80 -  
  01/24 Markit US Services PMI 06:45 Jan P 54.00 54.20 54.40 -  
  01/24 Leading Index 07:00 Dec -0.10% -0.10% 0.20% -  
  01/24 Kansas City Fed Manf. Activity 08:00 Jan 3.00 - 3.00 -  
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