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Market Commentary

Market Commentary

Today's Coupons
  10-Year Notes   98-17 (-03)  
  FN 2.5% Coupon   104-17.5 (+01)  
  Support   0.749%  
  Resistance   0.599%  
  Thursday, November 5, 2020

Treasury Yields Rise As Tech And Healthcare Shares Rally

Market opened today's session with treasuries lower across all maturities. 10-Year Treasury yield is at 0.7797, 1.68 bps increased from prior closing of 0.7629.
US Stocks opened higher this morning as tech and healthcare shares rallied. Notably, Qualcomm Inc. showed significant gains following a strong forecast highlighting increased demand for 5G devices. In regards to the presidential race, Joe Biden is one state away from winning enough electoral college votes, meanwhile the senate is expected to continue under Republican control. Hopes for further economic stimulus have diminished under this divided legislative scenario. Additionally, President Donald Trump's team has opened several legal fights to stop vote counts in at least two states. Elsewhere, Bitcoin doubled its value in 2020 after climbing $800 to $14,882. WTI crude lowered by 0.2% while Gold rose by 1.4% to $1,929.79 an ounce. On the economic front, Initial Jobless Claims failed to lower and meet expectations, reporting at 751 thousand claims for week end October 31. The states of Illinois, Kentucky, Kansas, and Ohio all saw increased initial claims, in addition to which, nearly 4 million people across the US claimed pandemic emergency unemployment compensation. Reporting later today is the Fed FOMC decision, with the pandemic taking center stage in regards to Fed policy going into 2021. With the senate already expected to remain under Republican control, thus hindering additional economic aid which was expected under a Democrat sweeep, fiscal policy may turn even more expansive in 2021. And reporting tomorrow is the unemployment rate, with expectations set at a slight decrease from a prior value of 7.90% to 7.60%.
The curve has bear-steepened with UST 10-Year yield up 1.68 bps.
This Week's Events
  11/02 ISM Prices Paid 07:00 Oct 61.50 65.50 62.80 -  
  11/02 Construction Spending MoM 07:00 Sep 1.00% 0.30% 1.40% 0.80%  
  11/03 Factory Orders 07:00 Sep 1.00% 1.10% 0.70% 0.60%  
  11/03 Durable Goods Orders 07:00 Sep F 1.90% 1.90% 1.90% -  
  11/03 Durables Ex Transportation 07:00 Sep F 0.80% 0.90% 0.80% -  
  11/04 MBA Mortgage Applications 04:00 30 Oct - 3.80% 1.70% -  
  11/04 ADP Employment Change 05:15 Oct 643k 365k 749k 753k  
  11/04 Trade Balance 05:30 Sep -$63.90b -$63.90b -$67.10b -$67.00b  
  11/04 Markit US Services PMI 06:45 Oct F 56.00 56.90 56.00 -  
  11/04 Markit US Composite PMI 06:45 Oct F - 56.30 55.50 -  
  11/05 Initial Jobless Claims 05:30 31 Oct 735k 751k 751k 758k  
  11/05 Continuing Claims 05:30 24 Oct 7200k 7285k 7756k 7823k  
  11/05 Bloomberg Consumer Comfort 06:45 1 Nov - 47.50 46.30 -  
  11/06 Change in Nonfarm Payrolls 05:30 Oct 600k - 661k -  
  11/06 Average Hourly Earnings MoM 05:30 Oct 0.20% - 0.10% -  
  11/06 Average Hourly Earnings YoY 05:30 Oct 4.50% - 4.70% -
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