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Market Commentary

Market Commentary

Today's Coupons
  10-Year Notes   1.652%  
  Support   1.581%  
  Resistance   1.225%  
  FN 2.5% Coupon   103.44 (-0.05)  
  Thursday, April 29, 2021

US Stocks Steady for Record Highs on GDP; More Earnings Release

The market opened today's session with treasuries lower across all maturities. The 10-Year Treasury yield is at 1.6718, 6.24 bps higher than prior closing of 1.6094.
US stock futures rose after corporate earnings, along with economic data, showed that the US economy advanced during the first three months of 2021. According to the Commerce Department, US Gross Domestic Product quickly rose to a 6.40% annualized rate during this first quarter. Futures on the Nasdaq 100 rose by more than 1%, signaling a record-high open for the gauge. Similarly, the S&P 500 futures also rose after the benchmark closed almost at its all-time high. Matching investors’ expectations, Caterpillar advanced 1.6% in early New York trading, while Apple rose 2.7%. Facebook jumped 8% as it posted sales that dwarfed estimates on the back of a 10% growth in active users. With almost half of the S&P 500 companies having reported results so far, about 88% have either met or beaten expectations. The 10-Year US Treasury yield is headed for its biggest weekly increase since early March. While the GDP figures do support the Federal Reserve’s strong assessment of the economy, the central bank is in no mood to halt aggressive support as it looks for even further progress in employment and inflation. On Wednesday, Chairman Jerome Powell dismissed worries about price surges and labor shortage, as the central bank is prepared to run the economy. President Biden unveiled his $1.8 trillion spending plan, targeting American families and adding to the economic optimism. With their plans, the Fed and President Biden have successfully boosted investor sentiment, which had shuffled in recent days between optimism over economic data and caution over stimulus tapering. A separate report on Thursday showed applications for U.S. state unemployment insurance fell last week to a fresh pandemic low as more Americans get vaccinated and return to work.
The curve has bear-steepened with UST 10-Year yield up 6.24 bps.
This Week's Events
  04/26 Durable Goods Orders 05:30 Mar P 2.30% 0.50% -1.20% -0.90%  
  04/28 MBA Mortgage Applications 04:00 23 Apr - -2.50% 8.60% -  
  04/29 GDP Price Index 05:30 1Q A 2.60% 4.10% 2.00% -  
  04/29 GDP Annualized QoQ 05:30 1Q A 6.70% 6.40% 4.30% -  
  04/29 Initial Jobless Claims 05:30 24 Apr 540k 553k 547k 566k  
  04/29 Continuing Claims 05:30 17 Apr 3590k 3660k 3674k 3651k  
  04/30 U. of Mich. Sentiment 07:00 Apr F 87.50 - 86.50 -
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