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Market Commentary

Market Commentary

Today's Coupons
  10-Year Notes   99-12 (-00.5)  
  FN 2.5% Coupon   104-24.5 (+00.5)  
  Support   1.942%  
  Resistance   0.619%  
  Friday, September 18, 2020

Treasury Yields Close To Flat As Equities Slightly Down

Market opened today's session with treasuries close to flat with the 10-Year Treasury yield at 0.689.

The US Market opened with mixed trends as investors searched for a reason to support a directional move. These same behaviors were also seen in the European Market due to a decline in tourism, fueled by the spread of Covid 19. Today marks the quarterly quadruple witching event, a day where numerous option and future contracts expire and roll over  for both equities and indices alike sparking meaningful liquidity and volatility. Meanwhile in the technology market, Oracle Corp. fell due to a U.S. plan to ban some transactions in the acquisition of Tik Tok. This historic deal will face shutdown if it is not completed by November 12th. US lawmakers continue to work on further fiscal stimulus but it would be a negative surprise to the markets if an agreement is not reached. The value of Gold has increased while Oil advanced to $41.26. On the economic front, the Conference Board US Leading Index failed to outperform expectations for the month of August after reporting an increase of 1.20% vs. expectations of 1.30%. Elsewhere, the University of Michigan sentiment index beat expectations after climbing to a six month high for the month of September. Reporting on Monday is the Chicago Fed National Activity Index with expectations set at 1.19.

The curve has bear-steepened with UST 10-Year yield close to flat.
This Week's Events
  09/15 Empire Manufacturing 05:30 Sep 6.90 17.00 3.70 -  
  09/15 Import Price Index MoM 05:30 Aug 0.50% 0.90% 0.70% 1.20%  
  09/15 Import Price Index YoY 05:30 Aug -2.10% -1.40% -3.30% -2.80%  
  09/16 MBA Mortgage Applications 04:00 11 Sep - -2.50% 2.90% -  
  09/17 Housing Starts 05:30 Aug 1488k 1416k 1496k 1492k  
  09/17 Housing Starts MoM 05:30 Aug -0.60% -5.10% 22.60% 17.90%  
  09/17 Building Permits 05:30 Aug 1512k 1470k 1495k 1483k  
  09/17 Building Permits MoM 05:30 Aug 2.00% -0.90% 18.80% 17.90%  
  09/17 Initial Jobless Claims 05:30 12 Sep 850k 860k 884k 893k  
  09/17 Continuing Claims 05:30 5 Sep 13000k 12628k 13385k 13544k  
  09/17 Bloomberg Consumer Comfort 06:45 13 Sep - 47.70 47.80 -  
  09/18 Leading Index 10:00 Aug 1.30% 1.20% 1.40% 2.00%  
  09/18 U. of Mich. Sentiment 10:00 Sep P 75.00 78.90 74.10 -
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