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Market Commentary

Market Commentary

Today's Coupons
  10-Year Notes   98-25.5 (-09.5)  
  FN 2.5% Coupon   103-23.5 (-01.5)  
  Support   2.138%  
  Resistance   0.635%  
  Tuesday, June 16, 2020

Treasury Yields Rise on Positive Retail Sales Data

Market opened today’s session with treasuries selling-off in the long end of the yield curve. 10-Year Treasury yield is at 0.7281, 0.66 bp increased from prior closing of 0.7215.

Retail Sales in May reported a record 17.70% jump, regaining more ground than expected after unprecedented drops in the past two months as economies reopened. Industrial Production in May also jumped to 1.40% from a downwardly revised prior of -12.50% and Capacity Utilization slightly edged higher to 64.80% from a downwardly revised prior of 64.00%. Lastly in the economic calendar, US Home Builders’ Confidence Index in June rose to 58 vs. 37 last month. Measure of present single-family sales rose to 63 from 42 prior. Aside from the positive economic data, it was also reported that dexamethasone; a widely available drug, can help critically ill coronavirus patients, boosting investor sentiment this morning. Stocks jumped and Treasuries slumped. The dollar weakened against most of its major peers and WTI crude climbed above $38 a barrel amid signs of improving demand. Sentiment was lifted even further after it was reported that the Trump administration is preparing a $1 trillion infrastructure proposal to bring the world’s largest economy back to life.

The curve has bear-steepened with UST 10-Year yield up 0.66 bp.
This Week's Events
  06/15 Empire Manufacturing 05:30 Jun -29.60 -0.20 -48.50 -  
  06/15 Net Long-term TIC Flows 13:00 Apr - -$128.40B -$112.60B -$111.60B  
  06/15 Total Net TIC Flows 13:00 Apr - $125.30B $349.90B $355.30B  
  06/16 Retail Sales Advance MoM 05:30 May 8.40% 17.70% -16.40% -14.70%  
  06/16 Capacity Utilization 06:15 May 66.90% 64.80% 64.90% 64.00%  
  06/17 MBA Mortgage Applications 04:00 12 Jun - - 9.30% -  
  06/17 Housing Starts 05:30 May 1100k - 891k -  
  06/17 Housing Starts MoM 05:30 May 23.50% - -30.20% -  
  06/17 Building Permits 05:30 May 1250k - 1074k 1066k  
  06/17 Building Permits MoM 05:30 May -17.30% - -20.80% -21.40%  
  06/18 Philadelphia Fed Business Outlook 05:30 Jun -22.90 - -43.10 -  
  06/18 Initial Jobless Claims 05:30 13 Jun 1290k - 1542k -  
  06/18 Continuing Claims 05:30 6 Jun 19850k - 20929k -  
  06/18 Bloomberg Consumer Comfort 06:45 14 Jun - - 38.70 -  
  06/18 Leading Index 07:00 May 2.30% - -4.40% -
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  This information is provided solely for informational use and is not intended as an advice for trading or investment purposes in any manner whatsoever. Sun West Mortgage Company, Inc. is not a licensed or registered broker or dealer and cannot provide investment strategies or recommendations. This information is provided to licensed brokers/lenders only and may not be copied or distributed to customers or potential customers. All loans are subject to approval. Certain restrictions may apply. Listed pricing is a morning indication only. Program rates, prices, guidelines, fees, costs, terms and conditions are subject to change without notice.  
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