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Market Commentary

Market Commentary

Today's Coupons
  10-Year Notes   100-05 (-13.5)  
  FN 3.5% Coupon   102-20.5 (-01.5)  
  Support   3.237%  
  Resistance   1.492%  
Monday, August 19, 2019
Treasury Yields Climb on Latest Trade News
Market opened today’s session with treasuries nudging lower across all maturities. 10-Year Treasury yield is at 1.6046, 5.08 bps increased from prior closing of 1.5538.

US stock futures rose after President Trump said that the US is “doing very well with China” while signaling a breakthrough is yet to come. Also, the US agreed to extend a temporary reprieve for US companies to trade with Huawei, putting the investor sentiment in a more positive note. Treasuries declined and bank shares rose in premarket along with yields. In China, the central bank announced its plan to reform its interest rate system and cut borrowing costs, mandating new loans to be priced to a revamped benchmark called the Loan Prime Rate, pushing shares in the region up north. The week’s main focus will be Fed Chair Powell’s address at the annual central bankers retreat in Jackson Hole, Wyoming on Friday which will be closely parsed for any hints whether US policy makers will add another rate cut next month. Also, on Wednesday, minutes of the Fed’s July meeting will provide details on the first rate cut in a decade. Elsewhere, WTI crude advanced this morning, trading slightly below $56 a barrel after a drone attack on oil and gas facilities in Saudi Arabia. There is no economic data release but later today, the US Treasury is scheduled to auction off $45 billion of 3-month bills and $42 billion of 6-month bills at 8:30 AM (PT).

The curve has bear-steepened with UST 10-Year yield up 5.08 bps.
This Week's Events
  08/19 No Data - - - - - -  
  08/20 No Data - - - - - -  
  08/21 MBA Mortgage Applications 04:00 16 Aug - - 21.70% -  
  08/21 Existing Home Sales 07:00 Jul 5.39m - 5.27m -  
  08/21 Existing Home Sales MoM 07:00 Jul 2.30% - -1.70% -  
  08/21 FOMC Meeting Minutes 11:00 31 Jul - - - -  
  08/22 Initial Jobless Claims 05:30 17 Aug 216k - 220k -  
  08/22 Continuing Claims 05:30 10 Aug - - 1726k -  
  08/22 Bloomberg Consumer Comfort 06:45 18 Aug - - 61.20 -  
  08/22 Markit US Services PMI 06:45 Aug P 52.80 - 53.00 -  
  08/22 Markit US Composite PMI 06:45 Aug P - - 52.60 -  
  08/22 Leading Index 07:00 Jul 0.20% - -0.30% -  
  08/22 Kansas City Fed ManfActivity 08:00 Aug 2.00 - -1.00 -  
  08/23 New Home Sales 07:00 Jul 645k - 646k -  
  08/23 New Home Sales MoM 07:00 Jul -0.20% - 7.00% -
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