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Market Commentary

Market Commentary

Today's Coupons
  10-Year Notes   99-12.5 (+00.5)  
  FN 2.5% Coupon   104-29 (-02)  
  Support   0.780%  
  Resistance   0.611%  
  Thursday, December 10, 2020

Treasury Yields Remain Unchanged as Stimulus Hopes Rise

Market opened today's session with treasuries unchanged across all maturities. 10-year Treasury yield remained at 0.9361, equivalent to its prior closing of 0.9361.

US stocks opened higher this morning as Treasury secretary Steven Mnuchin stated progress was being made towards passing a new stimulus package. Technology and energy companies led the way as DoorDash Inc. vastly outperformed in its IPO debut yesterday. Airbnb Inc. will offer its shares to the public on Thursday. In Europe, the pound fell as a trade deal struck between the UK and European Union becomes unlikely. Elsewhere, WTI crude advanced 2.50% to $46.64 a barrel while Gold rose by 0.40%. On the economic front, Jobless Claims rose more than expected after reporting at 853K for the week ending December 5. Additionally, Continuing Claims for week end November 28, also noted increases, the first case of an increase since August. With new restrictions expected to ramp up in the coming weeks, labor market recovery is expected to slow down. While new vaccines are expected to begin distribution this month, it will take several months before the vaccine is distributed to a significant number of Americans. Elsewhere, CPI MoM rose by 0.20% in the month of November. Notably, consumer prices as seen in services are experiencing the largest degree of downward pressure, in part thanks to elevated unemployment. Reporting tomorrow is PPI Final Demand MoM for the month of November, with expectations set at an increase of 0.10%.

The curve has slightly steepened, with UST 10-Year yield unchanged.

This Week's Events
  12/07 Consumer Credit 12:00 Oct 15.500b - 16.214b -  
  12/08 NFIB Small Business Optimism 03:00 Nov 102.50 101.40 104.00    
  12/09 MBA Mortgage Applications 04:00 4 Dec - -1.20% -0.60% -  
  12/09 JOLTS Job Openings 07:00 Oct 6300 6652 6436 6494  
  12/10 CPI MoM 05:30 Nov 0.10% 0.20% 0.00% -  
  12/10 CPI YoY 05:30 Nov 1.10% 1.20% 1.20% -  
  12/10 CPI Index NSA 05:30 Nov 260.089 260.229 260.388 -  
  12/10 CPI Core Index SA 05:30 Nov 269.570 269.887 269.296 -  
  12/10 Initial Jobless Claims 05:30 5 Dec 725k 853k 712k 716k  
  12/10 Continuing Claims 05:30 28 Nov 5210k 5757k 5520k 5527k  
  12/10 Bloomberg Consumer Comfort 06:45 6 Dec - 49.00 49.30 -  
  12/11 PPI Final Demand MoM 05:30 Nov 0.10% - 0.30% -  
  12/11 PPI Final Demand YoY 05:30 Nov 0.70% - 0.50% -  
  12/11 U. of Mich. Sentiment 07:00 Dec P 76.00 - 76.90 -
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