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Market Commentary

Market Commentary

Today's Coupons
  10-Year Notes   1.575%  
  Support   1.576%  
  Resistance   1.297%  
  FN 2.5% Coupon   102.469 (-0.094)  
     Friday, October 29, 2021

U.S. Stocks Decline On Inflation Fears


The Market opened today's session with treasuries lower across all maturities. The 10-year Treasury yield is currently at 1.6102, 3.02 bps higher than prior closing of 1.5800.

U.S stocks declined as traders weighed disappointing earnings sparked by concerns over inflation and monetary tightening. Supply-chain snarls and costlier raw materials are boosting expectations for rate hikes and dimming the economic outlook. S&P 500 fell 0.40% and Nasdaq 100 fell 0.80%. Inflation pressures and the prospect of interest-rate hikes are whipsawing bond markets. The curve between 20- and 30-years has inverted for the first time since the U.S. government reintroduced a two-decade maturity in 2020. The employment cost index rose 1.30% at the fastest pace on record in the third quarter as companies across a variety of sectors raised wages against a backdrop of labor. Personal income decreased $216.20 billion, or 1.00 percent at a monthly rate, while consumer spending increased $93.40 billion, or 0.60 percent, in September. The U.S. dollar ticked up from a one-month low and crude oil fluctuated. Bitcoin retreated below $58,000 during a sharp swoon in U.S. trading though it rebounded to around $61,000. Gold futures fell 0.70% to $1,789.10 an ounce. Stoxx Europe 600 fell 0.40%, with technology stocks leading losses. In China, the debt crisis at China Evergrande Group remains in focus. The MSCI World index fell 0.20%.

The curve has bear-flattened with the UST 10-Year yield up 3.02 bps.

This Week's Events
  10/25 Chicago Fed Nat Activity Index 05:30 Sep 0.20 -0.13 0.29 0.05  
  10/26 FHFA House Price Index MoM 06:00 Aug 1.50% 1.00% 1.40% -  
  10/26 S&P CoreLogic CS 20-City MoM SA 06:00 Aug 1.50% 1.17% 1.55% 1.53%  
  10/27 MBA Mortgage Applications 04:00 22-Oct - 0.30% -6.30% -  
  10/27 Wholesale Inventories MoM 05:30 Sep P 1.00% 1.10% 1.20% -  
  10/28 Initial Jobless Claims 05:30 23-Oct 288k 281k 290k 291k  
  10/28 Continuing Claims 05:30 16-Oct 2420k 2243k 2481k 2480k  
  10/29 PCE Deflator MoM 05:30 Sep 0.30% 0.30% 0.40% 0.30%  
  10/29 PCE Deflator YoY 05:30 Sep 4.40% 4.40% 4.30% 4.20%  
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