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Market Commentary

Market Commentary


Today's Coupons
  10-Year Notes   98-27.5 (+03)  
  FN 2.5% Coupon   103-21.5 (-01)  
  Support   2.138%  
  Resistance   0.635%  
  Wednesday, June 17, 2020

Treasury Yields Drift as Stocks Fluctuate

Market opened today’s session with treasuries drifting across all maturities. 10-Year Treasury yield is at 0.7380, 1.48 bps decreased from prior closing of 0.7528.

US stocks fluctuated amid increased concerns about the coronavirus. The number of cases rose to 137 in the new coronavirus outbreak in Beijing and cases rose in Florida while hospitalizations in Texas hit a record as concerns remain that some states may have reopened too quickly. Fed Chair Powell also said that the US economy has a long way to go to reverse the damage caused by the pandemic. In front of the Senate Banking Committee yesterday, Powell warned of “significant uncertainty” about the economic recovery, adding small businesses are at risk following the pandemic. He will be back in Congress today for his testimony before the House Financial Services Panel. In the economic calendar, MBA mortgage applications index rose 8.00% after rising 9.30% in prior week. Purchases were up 3.50% after rising 3.50% in prior week, marking the ninth straight gain in purchase applications and the highest level since January 2009. Refinances also increased 10.30% after rising 11.40% in prior week. Housing starts in May, on the other hand, rose to 974k from an upwardly revised prior of 934k but less than the forecast of 1100k despite a recent pickup in housing demand. Lastly, Building Permits also rose to 1220k from a downwardly revised prior of 1066k.

The curve has bull-flattened with UST 10-Year yield down 1.48 bps.
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 - 8.00% 9.30% -  
  06/17 Housing Starts 05:30 May 1100k 974k 891k 934k  
  06/17 Housing Starts MoM 05:30 May 23.50% 4.30% -30.20% -26.40%  
  06/17 Building Permits 05:30 May 1245k 1220k 1074k 1066k  
  06/17 Building Permits MoM 05:30 May -16.80% 14.40% -20.80% -21.40%  
  06/18 Philadelphia Fed Business Outlook 05:30 Jun -22.70 - -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 2.40% - -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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