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Market Commentary

Market Commentary

Today's Coupons
  10-Year Notes   101-17 (00)  
  FN 3.5% Coupon   101-06 (+01.5)  
  Support   3.237%  
  Resistance   2.428%  
Wednesday, May 08, 2019
Treasury Yields Slightly Lower on Latest Trade Speculation
Market opened today’s session with treasuries slightly inched higher across all maturities. 10-Year treasury yield is at 2.4476, 0.90 bp decreased from prior closing of 2.4566.

Another tweet from President Trump moved market this morning. US stock index futures briefly pared losses after President Trump tweeted that China had informed that they “are now coming to the US to make a deal”. However, the sell-off triggered by concerns over the outlook of trade war extended into a third day. Treasuries slightly edged higher as investors sought safe haven assets. As the US and China trade talks resume this week, focus will be on whether the US will follow through on threats to impose additional tariffs on Friday and whether China will retaliate. Elsewhere, the yuan fell as Chinese exports unexpectedly fell in April and WTI crude edged higher but still traded below $62 a barrel this morning. MBA Mortgage Applications index rose for the first time in five weeks by 2.70% after falling 4.30% in prior week. Both purchases and refinances increased 4.20% and 0.80% after falling 3.70% and 5.00% in prior week, respectively. Later today, the US Treasury is scheduled to auction off $27 billion of 10-year notes at 10:00 AM (PT).

The curve has bull-steepened with UST 10-Year yield down 0.90 bp.
This Week's Events
  05/06 No Data - - - - - -  
  05/07 JOLTS Job Openings 07:00 Mar 7350 7488 7087 7142  
  05/08 MBA Mortgage Applications 04:00 3 May - 2.70% -4.30% -  
  05/09 PPI Final Demand MoM 05:30 Apr 0.30% - 0.60% -  
  05/09 PPI Final Demand YoY 05:30 Apr 2.30% - 2.20% -  
  05/09 Trade Balance 05:30 Mar -$50.10b - -$49.40b -  
  05/09 Initial Jobless Claims 05:30 4 May 220k - 230k -  
  05/09 Continuing Claims 05:30 27 Apr 1670k - 1671k -  
  05/09 Bloomberg Consumer Comfort 06:45 5 May - - 60.40 -  
  05/09 Wholesale Inventories MoM 07:00 Mar F 0.00% - 0.00% -  
  05/09 Wholesale Trade Sales MoM 07:00 Mar 0.60% - 0.30% -  
  05/10 CPI MoM 05:30 Apr 0.40% - 0.40% -  
  05/10 CPI YoY 05:30 Apr 2.10% - 1.90% -  
  05/10 Monthly Budget Statement 11:00 Apr $165.00b - $214.30b -
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