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Market Commentary

Market Commentary

Today's Coupons
  10-Year Notes   102-27.5 (-29)  
  FN 3.5% Coupon   102-06 (-10)  
  Support   3.237%  
  Resistance   1.939%  
  Friday, July 5, 2019

Treasury Yields Rise on Strong Employment Reports

Market held steady overnight ahead of the June jobs report released this morning, but treasuries sold-off across all maturities, and U.S. Stocks came down from records after the employment data came in stronger than expected. The 10-Year treasury yield is currently at 2.052 after closing at 1.951 prior.

The June Nonfarm Payrolls showed the biggest increase since January 2019 after adding 224k jobs following a downwardly revised 72k addition the month prior, besting the survey for a 160k gain. Private Payrolls rose 191k following a revised 83k addition in May, while Manufacturing Payrolls added 17k following a mere 3k gain prior. The strong hiring rebound in June delivered signs that the economy remains on track, easing the case for the Fed to lower interest rates. The dollar rose, while gold dipped and crude oil fell. Meanwhile, the Unemployment Rate ticked higher to 3.70% in June from 3.60% the month prior; consensus expected for the rate to remain unchanged. Lastly, the Average Hourly Earnings MoM fell to 0.20% from an upwardly revised 0.30% in May, while its YoY level remained at 3.10% from prior.

The curve has bear-flattened with the UST 10-Year yield up 10.1 bps from prior closing.
This Week's Events
  07/01 Markit US Manufacturing PMI 06:45 Jun F 50.10 50.60 50.10 -  
  07/01 ISM Manufacturing 07:00 Jun 51.00 51.70 52.10 -  
  07/01 ISM Prices Paid 07:00 Jun 53.00 47.90 53.20 -  
  07/01 Construction Spending MoM 07:00 May 0.00% -0.80% 0.00% 0.40%  
  07/02 No Data - - - - - -  
  07/03 MBA Mortgage Applications 04:00 28 Jun - -0.10% 1.30% -  
  07/03 Challenger Job Cuts YoY 04:30 Jun - 12.80% 85.90% -  
  07/03 ADP Employment Change 05:15 Jun 140k 102k 27k 41k  
  07/03 Trade Balance 05:30 May -$54.00b -55.50b -$50.80b -51.20b  
  07/03 Initial Jobless Claims 05:30 29 Jun 223k 221k 227k 229k  
  07/03 Continuing Claims 05:30 22 Jun 1675k 1686k 1688k 1694k  
  07/03 Bloomberg Consumer Comfort 06:45 30 Jun - 62.60 63.60 -  
  07/03 Markit US Services PMI 06:45 Jun F 50.70 51.50 50.70 -  
  07/03 Markit US Composite PMI 06:45 Jun F - 51.50 50.60 -  
  07/03 Durable Goods Orders 07:00 May F -1.30% -1.30% -1.30% -  
  07/03 Factory Orders 07:00 May -0.60% -0.70% -0.80% -1.20%  
  07/03 Durables Ex Transportation 07:00 May F - 0.40% 0.30% -  
  07/04 No Data - - - - - -  
  07/05 Unemployment Rate 05:30 Jun 3.60% 3.70% 3.60% -  
  07/05 Average Hourly Earnings MoM 05:30 Jun 0.30% 0.20% 0.20% 0.30%  
  07/05 Average Hourly Earnings YoY 05:30 Jun 3.20% 3.10% 3.10% -  
  07/05 Labor Force Participation Rate 05:30 Jun 62.80% 62.90% 62.80% -
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