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Market Commentary

Market Commentary

Today's Coupons
  10-Year Notes   99-14.5 (+03.5)  
  FN 2.5% Coupon   105-03 (+00.5)  
  Support   0.791%  
  Resistance   0.615%  
  Thursday, December 24, 2020

Treasury Yields Fall as Brexit Talks Hit a New Milestone

Market opened today's session with treasuries higher across all maturities. 10-Year Treasury yield is at 0.9314, 1.16 bps decreased from prior closing of 0.9430.
US stocks opened higher this morning as a post-Brexit trade agreement was reached. In congress, House Republicans blocked an attempt by Democrats to increase stimulus check amounts to $2,000, a day after US President Donald Trump made the demand. In Hong Kong, Alibaba saw shares plummet as China began an investigation into the companies potentially monopolistic practices. In regards to Brexit, the accord struck today will allow for tariff-free trade in goods, however this will not be applicable to the services industry, which composes 80% of the UK economy. Had no deal been procured, UK GDP would have been reduced by up to 1.5%, however even with the deal, growth is still expected to be 0.5% lower than had Britain simply stayed with the EU. On the pandemic front, UK Prime Minister Boris Johnson placed tougher restrictions in an attempt to curtail the viruses spread. Elsewhere, WTI Crude lowered by 0.6% while Gold remained relatively the same at $1,873.46 an ounce. Reporting next week on Thursday are Initial Jobless Claims with expectations set at 826K.
The curve has bull-flattened with UST 10-Year yield down 1.16 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 - 0.80% 1.10% -  
  12/23 PCE Deflator MoM 05:30 Nov 0.10% 0.00% 0.00% -  
  12/23 PCE Deflator YoY 05:30 Nov 1.20% 1.10% 1.20% -  
  12/23 Initial Jobless Claims 05:30 19 Dec 880k 803k 885k 892k  
  12/23 Continuing Claims 05:30 12 Dec 5560k 5337k 5508k 5507k  
  12/23 Durable Goods Orders 05:30 Nov P 0.60% 0.90% 1.30% 1.80%  
  12/23 U. of Mich. Sentiment 07:00 Dec F 81.10 80.70 81.40 -  
  12/24 Bloomberg Consumer Comfort 06:45 20 Dec - 47.00 48.40 -  
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