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Market Commentary

Market Commentary


Today's Coupons
  10-Year Notes   98-19.5 (-00.5)  
  FN 2.5% Coupon   104-07 (-02.5)  
  Support   0.747%  
  Resistance   0.599%  
  Wednesday, October 28, 2020

Treasury Yields Fall As Markets React To Rising Infections

Market opened today's session with treasuries slightly higher across all maturities. 10-Year Treasury yield is at 0.7560, 1.16 bps decreased from prior closing of 0.7676.
Markets in both Europe and the US took a nose dive this morning as global COVID cases are once again on the rise. Early movers include General Electric Co., which saw gains following a beat on profit, in addition to higher free cash flow expectations. Laggards included Boeing Co. and Microsoft Corp., both of which showed a beat on earnings, however, Boeing is anticipated to increase job cuts while Microsoft offered a slightly lower earnings forecast. In Europe, equities lowered following a proposal by German Chancellor Angela Merkel, stating bars and restaurants should be closed for a month so as to limit the already rapidly increasing cases of coronavirus. Elsewhere, WTI crude dipped by 5.7% following a report showcasing an increase in stockpiles, a potential scenario which could be aggravated by a possible decrease in demand from renewed shutdowns. Gold lowered by 1.7%. On the economic front, MBA Mortgage Applications rose by 1.70% for week end October 23. Notably, refi's increased by 2.50% while VA refi's fell by 10.00%. The 30 year average fixed rate stood at 3.00%. In regard to Monthly Wholesale Inventories, the index fell by 0.10% for the month of September. This figure bodes well for the US economy as September's numbers decreased the trade deficit from from $83.10 billion to $79.40 billion, a byproduct of imports falling by 0.2% and exports rising by 2.7%. Tomorrow, Initial Jobless Claims and Annualized QoQ GDP will be reported, with the latter expected to increase by 32.00% after falling 31.40% a quarter prior.
The curve has bull-flattened with UST 10-Year yield down 1.16 bps.
This Week's Events
  10/26 Chicago Fed Nat Activity Index 05:30 Sep 0.73 0.27 0.79 1.11  
  10/26 Dallas Fed Manf. Activity 07:30 Oct 13.50 19.80 13.60 -  
  10/27 Durable Goods Orders 05:30 Sep P 0.50% 1.90% 0.50% 0.40%  
  10/27 S&P CoreLogic CS 20-City MoM SA 06:00 Aug 0.50% 0.47% 0.55% 0.75%  
  10/27 S&P CoreLogic CS 20-City YoY NSA 06:00 Aug 4.20% 5.18% 3.95% 4.12%  
  10/27 Conf. Board Consumer Confidence 07:00 Oct 102.00 100.90 101.80 101.30  
  10/28 MBA Mortgage Applications  04:00 23 Oct - 1.70% -0.60%  -  
  10/29 Initial Jobless Claims 05:30 24 Oct 770k - 787k -  
  10/29 Continuing Claims 05:30 17 Oct 7700k - 8373k -  
  10/29 GDP Annualized QoQ 05:30 3Q A 32.00% - -31.40% -  
  10/29 GDP Price Index 05:30 3Q A 2.90% - -1.80% -  
  10/29 Bloomberg Consumer Comfort 06:45 25 Oct - - 46.60 -  
  10/30 PCE Deflator MoM 05:30 Sep 0.20% - 0.30% -  
  10/30 PCE Deflator YoY 05:30 Sep 1.50% - 1.40% -  
  10/30 U. of Mich. Sentiment 07:00 Oct F 81.20 - 81.20 -
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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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