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Market Commentary

Market Commentary

Today's Coupons
  10-Year Notes   98-17 (-02.5)  
  FN 2.5% Coupon   104-10 (-03)  
  Support   0.747%  
  Resistance   0.599%  
  Tuesday, October 20, 2020

Treasury Yields Rise on US Stimulus Optimism

Market opened today's session with treasuries lower across all maturities. 10-Year Treasury yield is at 0.7940, 2.5 bps increased from prior closing of 0.7690.

Stocks opened higher this morning as House Speaker Nancy Pelosi indicated progress was being made in regard to passing a stimulus bill. Notably, Alphabet Inc. opened lower as the US Justice Department announced plans to sue the company over violations of antitrust laws. Alternatively, Proctor and Gamble rose after reporting the strongest growth in sales since 2005. European bank UBS also rose early morning after reporting revenue from equities and fixed income trading rose by 19% and 41%, respectively. As the pandemic claimed more than 40 million cases worldwide, with Germany and Bulgaria reporting record new cases, Europe has begun reinstituting lockdowns to curb the spread of the virus. Elsewhere, WTI crude fell by 0.6% to $40.60 a barrel, while Gold hovered at $1,905 an ounce. On the economic front, Housing Starts failed to meet expectations after reporting 1.415 million units in the month of September. Notably, permits for the construction of single family houses increased by 7.80%, the highest level since 2007, all the while accounting for 78% of total homebuilding. Reporting tomorrow are MBA Mortgage Applications for week end October 16, and on Thursday, Initial Jobless Claims report with expectations set at 870 thousand. Also happening on Thursday, the final US presidential debate pitting President Donald Trump against former Vice President Joe Biden will be hosted in Nashville Tennessee.

The curve has bear-steepened with UST 10-Year yield up 2.5 bps.
This Week's Events
  10/20 Building Permits 05:30 Sep 1520k 1553k 1470k 1476k  
  10/20 Building Permits MoM 05:30 Sep 3.00% 5.20% -0.90% -0.50%  
  10/20 Housing Starts 05:30 Sep 1465k 1415k 1416k 1388k  
  10/20 Housing Starts MoM 05:30 Sep 3.50% 1.90% -5.10% -6.70%  
  10/21 MBA Mortgage Applications 04:00 16 Oct - - -0.70% -  
  10/22 Initial Jobless Claims 05:30 17 Oct 870k - 898k -  
  10/22 Continuing Claims 05:30 10 Oct 9625k - 10018k -  
  10/22 Bloomberg Consumer Comfort 06:45 18 Oct - - 48.20 -  
  10/22 Leading Index 07:00 Sep 0.60% - 1.20% -  
  10/23 Markit US Services PMI 06:45 Oct P 54.60 - 54.60 -  
  10/23 Markit US Composite PMI 06:45 Oct P - - 54.30 -
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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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