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Market Commentary

Market Commentary

Today's Coupons
  10-Year Notes   108-16.5 (+04)  
  FN 3.5% Coupon   105-20.5 (+02.5)  
  Support   2.565%  
  Resistance   0.547%  
  Thursday, April 23, 2020

Treasury Yields Drift as Oils Rebound from Historic Loss

Market opened today’s session with treasuries drifting across all maturities. 10-Year Treasury yield is at 0.6078, 1.12 bps decreased from prior closing of 0.6190.

US stocks rose this morning as investors digested the latest economic and earnings data to parse the economic damages from the pandemic. Also, WTI crude started climbing back above $16 a barrel this morning which is still down more than 70% from the highs of earlier this year. Jobless Claims came in slightly below expected of 4500k at 4427k which helped easing the risk off mood. Today’s reading brought the five-week jobless claims total to more than 26 million. Continuing Claims jumped to 15.976 million from a downwardly revised prior of 11.912 million. A Gallup poll showed that about 25% of working Americans believe it is very or fairly likely they will lose their jobs in the next 12 months. The wave of losses which began with restaurant, hotel and factory workers is now hitting office and support workers. On the virus front, the House is set to vote in favor of the $484 billion stimulus package today before sending it to President Trump for his signature. Treasury Secretary Steven Mnuchin said he anticipates most of the economy will restart by the end of August. In the remainder of the economic calendar, Markit US Manufacturing PMI plunged to 36.90 from 48.50 prior while Services PMI also fell to 27.00 from 39.80 prior. Lastly, New Home Sales in March slowed down to 627k from a downwardly revised prior of 741k.

The curve has bull-flattened with UST 10-Year yield down 1.12 bps.
This Week's Events
  04/20 Chicago Fed Nat Activity Index 05:30 Mar -3.00 -4.19 0.16 0.06  
  04/21 Existing Home Sales 07:00 Mar 5.25m 5.27m 5.77m 5.76m  
  04/21 Existing Home Sales MoM 07:00 Mar -9.00% -8.50% 6.50% 6.30%  
  04/22 MBA Mortgage Applications 04:00 17 Apr - -0.30% 7.30% -  
  04/22 FHFA House Price Index MoM 06:00 Feb 0.30% 0.70% 0.30% 0.50%  
  04/23 Initial Jobless Claims 05:30 18 Apr 4500k 4427k 5245k 5237k  
  04/23 Continuing Claims 05:30 11 Apr 16738k 15976k 11976k 11912k  
  04/23 Bloomberg Consumer Comfort 06:45 19 Apr - 41.40 44.50 -  
  04/23 Markit US Manufacturing PMI 06:45 Apr P 35.00 36.90 48.50 -  
  04/23 Markit US Services PMI 06:45 Apr P 30.00 27.00 39.80 -  
  04/23 Markit US Composite PMI 06:45 Apr P - 27.40 40.90 -  
  04/24 Durable Goods Orders 05:30 Mar P -12.00% - 1.20% -  
  04/24 Durables Ex Transportation 05:30 Mar P -6.30% - -0.60% -
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