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Market Commentary

Market Commentary

Today's Coupons
  10-Year Notes   98-07 (-12)  
  FN 2.5% Coupon   104-05.5 (00)  
  Support   0.747%  
  Resistance   0.599%  
  Thursday, October 29, 2020

Treasury Yields Rise On Positive Economic Data

Market opened today's session with treasuries slightly lower across all maturities. 10-Year Treasury yield is at 0.7978, 2.68 bps increased from prior closing of 0.7710.

U.S. stocks opened higher this morning after suffering their worst day in four months. The S&P 500 Index saw early gains led by auto shares and positive economic data, meanwhile, the Nasdaq 100 rose in expectation of earning reports from Apple and Inc. Additionally, Facebook and Alphabet Inc. will report earnings after market close, with both expecting revenue growth, aided by the digital-advertising market. Meanwhile, in Europe, stocks plunged amid concerns of record Covid-19 infection rates. Spain, Italy, and Germany had record one-day virus cases. The euro slipped, as the European Central Bank left interest rates unchanged. Concerns over new lockdown measures had oil prices diving.

Initial Jobless Claims came in at 751,000, lower than the previous weekly revised figure of 791,000. Continuing claims also went down from a prior revision of 8,465,000 to 7,756,000. Both of these headline claims bode well for the state of the economy, however headwinds still remain as virus outbreaks worsen and companies continue to lay off workers. GDP Annualized QoQ report came in higher than expected at 33.10% versus an expected 32.00%. With record setting growth reported today, GDP still remains 3.5% below pre-pandemic highs, with the virus continuing to be the biggest hurdle as sectors such as hospitality and travel continue to struggle. Tomorrow’s economic calendar will provide the MNI Chicago PMI, which is expected to dip to 58.00 from a 62.40 prior, and the University of Michigan Sentiment report which is expected to remain the same at 81.2.

The curve has bear-steepened with UST 10-Year yield up 2.68 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 751k 787k 791k  
  10/29 Continuing Claims 05:30 17 Oct 7775k 7756k 8373k 8465k  
  10/29 GDP Annualized QoQ 05:30 3Q A 32.00% 33.10% -31.40% -  
  10/29 GDP Price Index 05:30 3Q A 2.90% 3.60% -1.80% -  
  10/29 Bloomberg Consumer Comfort 06:45 25 Oct - 46.30 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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