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Market Commentary

Market Commentary


Today's Coupons
  10-Year Notes   99-18.5 (+05.5)  
  FN 2.5% Coupon   105-07.5 (+03.5)  
  Support   0.791%  
  Resistance   0.615%  
  Tuesday, December 22, 2020

Treasury Yields Fall as Lawmakers Approve Stimulus Package

Market opened today's session with treasuries higher across all maturities. 10-Year Treasury yield is at 0.9213, 1.33 bps decreased from prior closing of 0.9346.
US stocks opened mixed this morning as lawmakers paved the way for a $2.3 trillion spending bill and stimulus package, now awaiting President Donald Trump's signature. In Europe, British Airways owner IAG SA saw shares rise as travel shares rebounded. In the UK, which saw the first sign of a new COVID strand and therefore tighter restrictions, pressure continued to build on Prime Minister Boris Johnson as he attempted to salvage a trade deal with the EU. Elsewhere, WTI Crude dropped by 1.6% while Gold rose by 0.1% to $1,878.81 a barrel. On the economic front, Annualized GDP QoQ slightly beat expectations after reporting at 33.40% for the third quarter. This figure contrasts significantly to the quarter two and quarter one losses of 31.40% and 5.00%, respectively. The Conference Board of Consumer Confidence failed to meet expectations of 97.00 after reporting at 88.60 for the month of December. In comparison to last month's figures, present situational confidence dropped from 105.90 to 90.30, meanwhile, consumer confidence expectations increased from 84.30 to 87.50. And in regard to Existing Home Sales, today's figure of 6.69mm came roughly in line with estimates of 6.70mm for the month of November. Notably home sales valued at an excess of $1mm increased by 88.1% from  a year ago, meanwhile, homes valued between $250K - $500K, which also accounted for 41.5% of total home sales, increased by 37.3%. Reporting tomorrow are MBA Mortgage Applications and Initial Jobless Claims, with the latter expected at 880K.
The curve has bull-flattened with UST 10-Year yield down 1.33 bps.
This Week's Events
  12/21 Chicago Fed Nat Activity Index 05:30 Nov 0.75 0.27 0.83 1.01  
  12/22 GDP Annualized QoQ 05:30 3Q T 33.10% 33.40% 33.10% -  
  12/22 GDP Price Index 05:30 3Q T 3.60% 3.50% 3.60% -  
  12/22 Conf. Board Consumer Confidence 07:00 Dec 97.00 88.60 96.10 92.90  
  12/22 Richmond Fed Manufact. Index 07:00 Dec 11.00 19.00 15.00 -  
  12/23 MBA Mortgage Applications  04:00 18 Dec - - 1.10% -  
  12/23 PCE Deflator MoM 05:30 Nov 0.10% - 0.00% -  
  12/23 PCE Deflator YoY 05:30 Nov 1.20% - 1.20% -  
  12/23 Initial Jobless Claims 05:30 19 Dec 880k - 885k -  
  12/23 Continuing Claims 05:30 12 Dec 5560k - 5508k -  
  12/23 Durable Goods Orders 05:30 Nov P 0.60% - 1.30% -  
  12/23 U. of Mich. Sentiment 07:00 Dec F 81.10 - 81.40 -  
  12/24 Bloomberg Consumer Comfort 06:45 20 Dec - - 48.40 -  
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