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Market Commentary

Market Commentary

Today's Coupons
  10-Year Notes   96-12 (-01-09+)  
  FN 2.5% Coupon   102-29 (-030)  
  Support   1.086%  
  Resistance   0.807%  
  Thursday, February 25, 2021

Treasury Yields Rise as Unemployment Claims Decline

Market opened today's session with treasuries lower across all maturities. 10-Year Treasury yield is at 1.4596, 8.40 bps increased from prior closing of 1.3756.
US stocks opened lower this morning as tech shares once again led losses. Notable gainers include Gamestop Corp., which saw shares surge by as much as 85% early morning. In regards to the Fed, Federal Reserve Chairman Jerome Powell continued to emphasize the need for further government aid, stating the economy had a long way to go before reaching pre-pandemic levels. Elsewhere, Bitcoin rose past $50,000, all the while WTI crude and Gold both lowered by 0.10% and 1.70%, respectively. On the economic front, Durable Goods Orders tripled expectations after reporting an increase of 3.40% for the month of January. Rising at the fastest pace in six months, today's figure also pointed towards an increase of 2.10% for shipments of non-defense capital goods, a key figure used to calculate government investment in GDP. Notably, when excluding transportation, durable goods increased by 1.40%, all the while, orders for computer related products increased by 8.70% in January. Annualized GDP QoQ increased by 4.10% in the fourth quarter of 2020. Notably, personal consumption only saw gains of 2.40% after having seen a rise of 41.00% a quarter prior. In other news, Initial Jobless Claims decreased from a previously adjusted 841K claims to 730K claims for the week ending February 20. Notably, President Joe Biden's proposed $1.9 trillion aid bill, if signed by March 14, would continue and expand upon the federal unemployment benefits provided by Pandemic Unemployment Assistance and Pandemic Emergency Unemployment Compensation, which are set to expire mid-March. Pandemic Unemployment Assistance noted a decrease of 61K applications, towards 451K, all the while Pandemic Emergency Claims saw claims increase by 1,004K after having dropped by 717K in a prior report. Reporting tomorrow are Personal Income and Spending, as well as the University of Michigan Sentiment index, all expected at 9.50%, 2.50%, and 76.50, respectively.
The curve has bear-steepened with UST 10-Year yield up 8.40 bps.
This Week's Events
  02/22 Chicago Fed Nat Activity Index 05:30 Jan 0.50 0.66 0.52 0.41  
  02/22 Leading Index 07:00 Jan 0.40% 0.50% 0.30% 0.40%  
  02/23 S&P CoreLogic CS 20-City YoY NSA 06:00 Dec 9.90% 10.10% 9.08% 9.20%  
  02/23 S&P CoreLogic CS 20-City MoM SA 06:00 Dec 1.25% 1.25% 1.42% 1.46%  
  02/23 Conf. Board Consumer Confidence 07:00 Feb 90.00 91.30 89.30 88.90  
  02/23 Richmond Fed Manufact. Index 07:00 Feb 15.00 14.00 14.00 -  
  02/24 MBA Mortgage Applications  04:00 19 Feb - -11.40% -5.10% -  
  02/25 Durable Goods Orders 08:30 Jan P 1.10% 3.40% 0.50% 1.20%  
  02/25 Initial Jobless Claims 08:30 20 Feb 825k 730k 861k 841k  
  02/25 Continuing Claims 08:30 13 Feb 4460k 4419k 4494k 4520k  
  02/25 GDP Price Index 08:30 4Q S 2.00% 2.10% 2.00% -  
  02/25 Bloomberg Consumer Comfort 09:45 21 Feb - 47.30 45.80 -  
  02/26 PCE Deflator MoM 08:30 Jan 0.30% - 0.40% -  
  02/26 PCE Deflator YoY 08:30 Jan 1.40% - 1.30% -  
  02/26 U. of Mich. Sentiment 10:00 Feb F 76.50 - 76.20 -  
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