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July 27, 2020

Haven Assets Rise as Congress Continues to Debate Further Stimulus

 

Haven assets rise, gold breaching $1,900 for the first time since 2011. Safe haven assets are higher to start the week, gold in particular rising above its all-time high to trade near $2,000. Treasurys are showing similar gains with the pandemic impact and US-China trade tensions reducing risk appetite – yields/swap rates are down modestly across the curve. The 10-year Treasury yield opened today’s trading session near 0.58%- continuing to trade in the narrow 10-basis point range near historical lows that it’s occupied for the last several weeks.

 

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July 24, 2020

Rates Mixed as Congress Discusses Next Stimulus Bill

Stocks end winning streak following rise in weekly jobless claims. After trending downward for nearly four months straight, the Labor Department reported 1.416 million Americans filed for the week ending July 18th. With the number plateauing at 1.3 million the week before, economists fear the US recovery will be further delayed. Equities halted their four-day rise -- the S&P 500 and DJIA falling 1.2% and 1.3%, respectively, while the tech-heavy Nasdaq plummeted 2.3%. Treasury yields and swap rates ended mixed across a flattening curve. The 10-year closed flat at 0.57...

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July 23, 2020

Equities Rise as Markets Await Stimulus Bill

US stocks mostly higher despite geopolitical tensions and stimulus bill consternation. US-China tensions weighed on markets yesterday after the US ordered China's Houston consulate to stop operations for the time-being. Protection of intellectual property was cited as the driver behind the decision, but Chinese media labeled the move an “anti-China strategy” ahead of the upcoming presidential election. In Washington, negotiations over a new stimulus bill continue to be a concern, especially with Congress’ August recess on the horizon. However major US equity indices...

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July 22, 2020

Rates Remain Rangebound as Congress Discusses Another Stimulus Bill

Equities fluctuate as financial markets continue to weigh COVID impact. Major stock indices were a mixed bag yesterday as lawmakers negotiate over the appropriate stimulus for the US economy. The S&P 500 rose 0.2% to a four-month high and the DJIA gained 0.6%, while the Nasdaq fell 0.8% from all-time highs. US Treasury yields and swap rates continue to hold near historical lows, with the 10-year UST yield falling below 0.60% this morning.

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July 21, 2020

Equities Rise to Pre-Pandemic Levels

US stocks rise to pre-pandemic levels. Equities finally turned positive for the year after yesterday’s rally pushed them above pre-pandemic levels. The S&P 500 and DJIA closed up 0.8% and 0.1% respectively while the Nasdaq rose 2.5% to hit an all-time high, jumping the most since April. Treasury yields and swap rates traded in a narrow range throughout the day, eventually closing moderately lower across the curve. This morning, equities continue to climb higher while swap rates and Treasury yields are slightly lower- the 10-year yield trading down to 0.604%.

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July 20, 2020

Rates Are Lower to Start the Week as Virus Cases Worsen

Rates are lower this morning as virus cases continue to climb in US hotspots. Over the weekend, Florida reported its fifth day in a row of more than 10,000 daily cases. In California, LA Mayor Eric Garcetti publicly suggested that another stay-at-home order may be necessary as the coronavirus continues to spread rapidly in the city. S&P futures are trading slightly lower after Friday's session ended with a third straight week of gains. Treasury yields and swap rates are 1-3 basis points lower across the curve, the 10-year yield falling 2 bps to 0.605%.

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July 17, 2020

Rates Fall After Data Fails to Show an Economic Rebound

Rates fall as economic data fails to show a significant economic rebound. Initial jobless claims failed to decline significantly, and came in roughly in line with the week before- igniting fears that the new wave of infections could deter an economic rebound. Though retail sales jumped over 7% in June, threats of additional lockdown measures pulled risk assets lower – the S&P 500 and DJIA falling 0.3% and 0.5% respectively . Treasury yields and swap rates fell across the curve and are modestly lower this morning once more- the 10-year yield falling to 0.612%.

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July 16, 2020

Rates Stay Steady as Researchers Close in on Virus Vaccine

Equities edge higher, rates little changed as researchers close in on a virus vaccine. A report published online by the New England Journal of Medicine revealed that a vaccine developed by Moderna produced an immune response in all 45 patients tested. Infectious disease expert Anthony Fauci cheered on the developments, commenting, "the gold standard of protection against a viral infection is neutralizing antibodies. And the data from the study, small numbers as it may be, are pretty clear that this vaccine is capable of inducing quite good [levels] of neutralizing...

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July 15, 2020

Rates Pushed Higher by Strong Bank Earnings Reports

Equities extend gains for third straight day. News surrounding Moderna Inc.'s COVID-19 vaccine pushed equities higher yesterday afternoon, as the company reported all patients tested produced antibodies in their initial trial. The update comes as the virus continues to spread in US hotspots, with Florida reporting another one-day record and Arizona hitting the highest number of cases in over 10 days. Led by rallies in the energy and industrial sectors, US stocks surged -- the S&P 500 and DJIA closing 1.3% and 2.1% higher. Treasury yields and swap rates traded sideways...

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July 14, 2020

Rates Fall as Bank Earnings Season Kicks Off

Rates reverse course, end lower as acceleration in new COVID-19 cases weighs on sentiment. After rising alongside equities for the majority of the day, rates reversed their direction when fears of additional lockdown measures returned. California, a current virus hotspot, elected to stop all indoor dining while LA country announced all schools will remain remote through the next year. US virus cases are just shy of 3.3 million with fatalities crossing 134,000. Equities also gave back gains, the S&P 500 and DJIA falling 0.9% and rising 0.1% respectively. The 10-year...

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