Lots of Indecision, But The Outcome Should Make Sense

Both stocks and bonds are trading sideways after taking a step back from their early June momentum.  This indecision reflects uncertainty about economic reopening vs rising covid case counts.  As soon as a clear winner emerges, markets (and rates) will move accordingly.

Econ Data / Events

  • 11:30-11:50 AM (ET) - Fed 30yr UMBS Buying  

  • GDP (Q1) (-5.0 vs -5.0 f'cast/prev)

  • Jobless Claims (1.48m vs 1.3m f'cast) 1.54m prev

  • Continued Claims (19.52m vs 19.96m f'cast) 20.28m prev

  • Durable Goods (15.8 vs 10.9 f'cast) -18.1 prev

  • Cap-Ex (2.3 vs 1.0 f'cast) -6.5 prev

Market Movement Recap
08:15 AM

Stocks and bond yields fell overnight amid a general "risk-off" trade.  B Relative to yesterday's bigger move, the overnight session was basically flat.

11:28 AM

Stocks and bonds remain broadly sideways although bonds are off their best levels of the day.  10yr yields down 1bp at .669 and UMBS 2.0 unchanged at 102-00

01:54 PM

Stocks are still flat on the day and have been trading a narrow range.  Treasuries have weakened slightly but remain just barely in positive territory.  MBS are outperforming with 2.0 UMBS at the highs of the day.