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Market Commentary

Market Commentary

Today's Coupons
  10-Year Notes   100-15 (+10.5)  
  FN 3.5% Coupon   102-19.5 (+03.5)  
  Support   3.237%  
  Resistance   1.492%  
Friday, August 23, 2019
Treasury Yields Lower as China Retaliates
Market opened today’s session with treasuries rallying across all maturities. 10-Year Treasury yield is at 1.5791, 3.40 bps decreased from prior closing of 1.6131.

US stock index futures pointed to a lower open this morning after China retaliated with tariffs on $75 billion of US goods including autos which will be implemented in two batches on September 1st and December 15th, worsening the dispute between the two largest economies that jeopardizes the global economy. General Motors, Ford Motor, Fiat Chrysler, and Tesla fell in premarket on the news. Against remarks pushing back against policy easing recently made by three regional Fed presidents, St. Louis Fed President Bullard said he wanted to see more interest rate cuts in order to protect the economy from a possible global economic slowdown. The highly anticipated speech from Fed Chair Powell was somewhat dovish but not any more so than what we saw from the July FOMC statement. Also, it was more geared toward an academic view of monetary policy over recent years, and not heavily focused on the current outlook. Elsewhere, WTI crude slid this morning, trading slightly above $54 a barrel. New Home Sales in July declined to 635k from an upwardly revised prior of 728k vs. 647k consensus.

The curve has bull-steepened with UST 10-Year yield down 3.40 bps.
This Week's Events
  08/19 No Data - - - - - -  
  08/20 No Data - - - - - -  
  08/21 MBA Mortgage Applications 04:00 16 Aug - -0.90% 21.70% -  
  08/21 Existing Home Sales 07:00 Jul 5.40m 5.42m 5.27m 5.29m  
  08/21 Existing Home Sales MoM 07:00 Jul 2.50% 2.50% -1.70% -1.30%  
  08/21 FOMC Meeting Minutes 11:00 31 Jul - - - -  
  08/22 Initial Jobless Claims 05:30 17 Aug 216k 209k 220k 221k  
  08/22 Continuing Claims 05:30 10 Aug 1707k 1674k 1726k 1728k  
  08/22 Bloomberg Consumer Comfort 06:45 18 Aug - 61.50 61.20 -  
  08/22 Markit US Services PMI 06:45 Aug P 52.80 50.90 53.00 -  
  08/22 Markit US Composite PMI 06:45 Aug P - 50.90 52.60 -  
  08/22 Leading Index 07:00 Jul 0.30% 0.50% -0.30% -0.10%  
  08/22 Kansas City Fed ManfActivity 08:00 Aug 1.00 - -1.00 -  
  08/23 New Home Sales 07:00 Jul 647k 635k 646k 728k  
  08/23 New Home Sales MoM 07:00 Jul 0.20% -12.80% 7.00% 20.90%
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