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Market Commentary

Market Commentary

Today's Coupons
  10-Year Notes   99-16.5 (-03)  
  FN 3.5% Coupon   101-01.5 (-02)  
  Support   3.237%  
  Resistance   2.356%  
Tuesday, May 21, 2019
Treasury Yields Climb on Huawei Reprieve
Market opened today’s session with treasuries slightly inching lower across all maturities. 10-Year treasury yield is at 2.4193, 0.36 bp increased from prior closing of 2.4157.

US stocks opened higher this morning as the Commerce Department granted a 90-day reprieve for certain US companies and wireless customers using Huawei Tech equipment yesterday. However, Chinese officials continued to warn that China will retaliate President Trump’s move to curb their largest tech company. In corporate news, Tesla Inc. has slumped in 9 of the last 10 trading days and fell below $200 a share yesterday. It also fell in premarket as Morgan Stanley slashed its bear forecast from $97 to just $10. Boeing, on the other hand, rose in premarket after a Wall Street Journal report said that a bird strike may have caused the crash of its 737 Max back in March. Elsewhere, WTI crude continued to trade above $63 a barrel this morning.

Existing Home Sales in April fell to 5.19 million from 5.21 million in March vs. 5.35 million estimation. Later today, the US Treasury is scheduled to auction off $26 billion of 52-week bills at 8:30 AM (PT). Also, a couple of Fed speeches are scheduled for today. Chicago Fed President Evans will discuss the economy and monetary policy at Atlanta Fed’s annual financial markets conference in Florida, and St. Louis Fed President Bullard will discuss the outlook for the US economy and monetary policy in Hong Kong. Tomorrow, investors will turn their focus to release of minutes from the latest FOMC meeting.

The curve has bear-flattened with UST 10-Year yield up 0.36 bp.
This Week's Events
  05/20 Chicago Fed Nat Activity Index 05:30 Apr -0.20 -0.45 -0.15 0.05  
  05/21 Existing Home Sales 07:00 Apr 5.35m 5.19m 5.21m -  
  05/21 Existing Home Sales MoM 07:00 Apr 2.70% -0.40% -4.90% -  
  05/22 MBA Mortgage Applications 04:00 17 May - - -0.60% -  
  05/22 FOMC Meeting Minutes 11:00 1 May - - - -  
  05/23 Initial Jobless Claims 05:30 18 May 215k - 212k -  
  05/23 Continuing Claims 05:30 11 May 1667k - 1660k -  
  05/23 Bloomberg Consumer Comfort 06:45 19 May - - 59.90 -  
  05/23 Markit US Manufacturing PMI 06:45 May P 52.60 - 52.60 -  
  05/23 Markit US Services PMI 06:45 May P 53.50 - 53.00 -  
  05/23 Markit US Composite PMI 06:45 May P - - 53.00 -  
  05/23 New Home Sales 07:00 Apr 675k - 692k -  
  05/23 New Home Sales MoM 07:00 Apr -2.50% - 4.50% -  
  05/23 Kansas City Fed ManfActivity 08:00 May 6.00 - 5.00 -  
  05/24 Durable Goods Orders 05:30 Apr P -2.00% - 2.60% -  
  05/24 Durables Ex Transportation 05:30 Apr P 0.10% - 0.30% -
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