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Market Commentary

Market Commentary

Today's Coupons
  10-Year Notes   108-15.5 (-01.5)  
  FN 3.5% Coupon   105-23 (+02)  
  Support   2.541%  
  Resistance   0.547%  
  Friday, April 24, 2020

Treasury Yields Remain Flat as Oils Rise for Third Day

Market opened today’s session with treasuries nearly unchanged across all maturities. 10-Year Treasury yield is at 0.6024, 0.09 bp increased from prior closing of 0.6015.

US stocks erased early gains and remained mostly flat as investors digested the latest earnings reports and economic data. Oils also rallied for a third consecutive day with WTI crude trading above $17 a barrel after its historical plunge from earlier this week. In the economic calendar, Durable Good Orders plunged to -14.40% from a downwardly revised prior of 1.10%. However, University of Michigan Sentiment slightly rose to 71.80 from 71.00 prior vs. 68.00 consensus. In Germany, business confidence dropped to a record low while U.K. retail sales suffered their biggest fall ever in March. The coronavirus outbreak, while trending lower in much of Europe, is still showing worrying signs of resilience, leading to increased concerns of a second wave of infections should the current restrictions be lifted too early. On the contrary, Treasury Secretary Steven Mnuchin said he expected the U.S. economy to start reopening in May and June, with a strong rebound in output in the third and fourth quarter. He also added the possibility of creating a government lending program for U.S. oil companies that have been devastated by the collapse in crude prices. Later today, the US Treasury is scheduled to auction off 2-year and 5-year notes.

The curve has steepened with UST 10-Year yield up 0.09 bp.
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% -14.40% 1.20% 1.10%  
  04/24 Durables Ex Transportation 05:30 Mar P -6.50% -0.20% -0.60% -0.70%
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