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Market Commentary

Market Commentary

Today's Coupons
  10-Year Notes   99-17.5 (+03)  
  FN 2.5% Coupon   105-01.5 (+01.5)  
  Support   1.942%  
  Resistance   0.619%  
  Friday, September 11, 2020

Treasury Yields Rise as CPI Beats Expectations

The market opened today’s session with Treasuries slightly higher across all maturities. 10-year Treasury yield is at 0.67, 0.82 bp decreased from prior closing of 0.68.

US  stocks are close to flat on the week after experiencing vol in the energy and tech sectors . The S&P 500 is opening higher while the NASDAQ 100 is headed for its first week over week decline since March on market uncertainty. Equity futures retreated overnight but have turned around this morning. Globally stocks remain on track for the first back-to-back weekly declines since March following a rally that added $7 trillion to US equity values. The pandemic continues to create volatility in the global economy, with US data showing uncertainty in recent labor-market advances and virus cases continuing to surge globally. The Euro rallied on President Christine Lagarde's comments around currencies. Chief Economist Philip Lanre has indicated that additional monetary stimulus may be needed. As Brexit talks continue to lack uniformity, the British pound headed for its biggest weekly drop since March. Crude oil has a $37 handle and gold has retraced a bit. The MSCI Emerging Markets Index rose, ending a recent losing streak. On the economic front, CPI MoM beat expectations after rising 0.40% in August. The supply-constrained used vehicle market has put upward pressure on the CPI reading, with the index for used cars and trucks increasing 5.40% in August. With core CPI around 1.70% YoY, the Fed is further supported in tolerating inflation in excess of 2% to compensate for past underperformance.

The curve has bull-flattened with UST 10-Year yield down 0.82 bp.

This Week's Events
  09/08 NFIB Small Business Optimism 03:00 Aug 99.00 100.20 98.80 -  
  09/09 MBA Mortgage Applications 04:00 4 Sep - 2.90% -2.00% -  
  09/09 JOLTS Job Openings 07:00 Jul 6000 6618 5889 6001  
  09/10 PPI Final Demand MoM 05:30 Aug 0.20% 0.30% 0.60% -  
  09/10 PPI Final Demand YoY 05:30 Aug -0.30% -0.20% -0.40% -  
  09/10 Initial Jobless Claims 05:30 5 Sep 850k 884k 881k 884k  
  09/10 Continuing Claims 05:30 29 Aug 12904k 13385k 13254k 13292k  
  09/10 Bloomberg Consumer Comfort 06:45 6 Sep - 47.80 45.10 -  
  09/11 CPI MoM 05:30 Aug 0.30% 0.40% 0.60% -  
  09/11 CPI YoY 05:30 Aug 1.20% 1.30% 1.00% -  
  09/11 CPI Index NSA 05:30 Aug 259.606 259.918 259.101 -  
  09/11 CPI Core Index SA 05:30 Aug 268.440 268.747 267.715 -  
  09/11 Monthly Budget Statement 11:00 Aug -$242.70B - -$200.30B -
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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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