|10-Year: +12/32....%.... GNMAs: .... USD/JPY: 112.58.... EUR/USD: 1.1379|
--Worries U.S-China trade deal will be averted after Huawei Technologies CFO is arrested in Canada (and expected to be extradited to U.S) on allegations the company violated U.S. trade sanctions on Iran
--All securities up for the day but finish well off best levels
--ADP employment Change for November: Actual 179,000, Briefing.com consensus 225,000, Prior revised to 225,000 from 227,000
--Q3 Productivity: Actual 2.3%, Briefing.com consensus 2.2%, Prior 2.2%. Unit labor costs: Actual 0.9%, Briefing.com consensus 1.2%, Prior 1.2%
--October Trade Deficit: Actual -$55.5 billion, Briefing.com consensus -$54.7 billion, Prior revised to -$54.6 billion from -$54.0 billion
--Initial Claims for week ending Dec. 01: Actual 231,000, Briefing.com consensus 225,000, Prior revised to 235,000 from 234,000. Continuing claims for week ending Nov. 24: Actual 1.631 million, Prior revised to 1.705 million from 1.710 million
--Factory Orders for October: Actual -2.1%, Briefing.com consensus -2.0%, Prior revised to +0.2% from +0.7%
--ISM Non-Manufacturing Index for November: Actual 60.7%, Briefing.com consensus 59.0%, Prior 60.3%
Taking It Slow
- The Treasury market had quite a run to start the day, but has been retracing its steps for the past hour or so at the same time the stock market has been trying work its way back from large losses that had the S&P 500 (-1.5%) down as much as 2.9% at its morning low.
- Strikingly, the low for the stock market and bond market coincided with the close of European markets, which suggests it could have been driven by the angst of foreign traders.
- In any event, yields continue to be lower across the curve versus yesterday's settlement.
- Short rates have been helped by the notion that slower growth will slow the Fed's jaunt down the rate-hike path.
- On a related note, Dallas Fed President Kaplan (non-FOMC voter) said today that the Fed needs to be gradual and patient and that he thinks the fed funds rate is a little bit below neutral but that the Fed is approaching the neutral rate.
- Yield check:
- 2-yr: -5 bps to 2.75%
- 3-yr: -5 bps to 2.77%
- 5-yr: -5 bps to 2.74%
- 10-yr: -5 bps to 2.87%
- 30-yr: -4 bps to 3.13%