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Market Commentary

Market Commentary


Today's Coupons
  10-Year Notes   99-16.5 (-05.5)  
  FN 2.5% Coupon   104-06.5 (+00.5)  
  Support   2.138%  
  Resistance   0.620%  
  Wednesday, July 1, 2020

Treasury Yields Climb on Vaccine Hope

Market opened today’s session with treasuries selling-off across all maturities. 10-Year Treasury yield is at 0.6906, 3.45 bps increased from prior closing of 0.6561.

Stocks gained this morning as an early trial of an experimental shot from Pfizer Inc and BioNtech spurred immune responses in healthy patients despite a few side effects. Pfizer also said that, if the vaccine get regulatory approval, it expects to make up to 100 million doses by year-end and “potentially” more than 1.2 billion by the end of 2021. Both companies rose on the news. FedEx also led the gain in equities as its shares had its biggest-ever surge after posting a surprise profit. Treasuries sold-off along with the dollar and WTI crude slightly edged higher, trading above $39 a barrel this morning. We also had a handful of economic data today. MBA mortgage applications index fell 1.80% after falling 8.70% in prior week. Both purchases and refinances decreased 1.30% and 2.20% after falling 3.00% and 11.70% in prior week, respectively. ADP Employment Change in June declined to 2369k from an upwardly revised prior of 3065k vs. 2900k consensus. Positive manufacturing data set the tone as well this morning. Markit US Manufacturing PMI slightly rose to 49.80 from 49.60 prior and ISM Manufacturing also surged to 52.60 from 43.10 prior. Lastly, Construction Spending in May came in below consensus of 1.00% at -2.10%. Later today, June FOMC meeting minutes will be released at 11:00 AM (PT).

The curve has bear-steepened with UST 10-Year yield up 3.45 bps.
This Week's Events
  06/29 Dallas Fed Manf. Activity 07:30 Jun -21.40 -6.10 -49.20 -  
  06/30 S&P CoreLogic CS 20-City MoM SA 06:00 Apr 0.50% 0.33% 0.47% 0.49%  
  06/30 S&P CoreLogic CS 20-City YoY NSA 06:00 Mar 3.80% 3.98% 3.92% 3.91%  
  07/01 MBA Mortgage Applications 04:00 26 Jun - -1.80% -8.70% -  
  07/01 ADP Employment Change 05:15 Jun 2900k 2369k -2760k 3065k  
  07/01 Markit US Manufacturing PMI 06:45 Jun F 49.60 49.80 49.60 -  
  07/02 Initial Jobless Claims 05:30 27 Jun 1336k - 1480k -  
  07/02 Continuing Claims 05:30 20 Jun 18904k - 19522k -  
  07/02 Bloomberg Consumer Comfort 06:45 28 Jun - - 41.40 -  
  07/02 Durables Ex Transportation 07:00 May 4.00% - 4.00% -  
  07/02 Durable Goods Orders 07:00 May F 15.80% - 15.80% -
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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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