Morning Market Update: April 23, 2019

Yield Curve Modestly Steepens in Mixed Equity Trading

Commentary for Monday: Treasurys sold off as equities ended mixed after the long holiday weekend. The Dow decreased on the day while the S&P and NASDAQ increased. Yields were initially higher in quiet overnight trading. They shifted modestly higher in the morning and briefly dipped on a greater-than-expected decline in existing home sales. Yields were little changed the remainder of the session before ending with the curve modestly steeper.

This Morning: Treasury yields are little changed ahead of economic data to be released on house prices. 

Existing home sales decreased by a greater-than-expected 4.9% in March to 5.21M. The prior month was downwardly revised from 5.51M to 5.48M. Single-family home sales declined from 4.91M to 4.67M in March, while existing condo sales fell 5.3% month-over-month. Home sales decreased across all regions. The Northeast fell 2.9%, the Midwest dropped 7.9%, the South decreased 3.4%, and the West fell 6.0%. On an annual basis, existing home sales are down 5.4%. 

The Chicago Fed National Activity Index rose to -0.15 in March from -0.31 in February. Three of the four main indicators that make up the index increased month-over-month, but three components made negative contributions to the index as well. Personal consumption and housing pulled the index down by 0.07, while production-related indicators came in at -0.10. Employment, however, improved slightly from -0.15 to -0.03. As a result, the three-month average decreased to -0.24 from -0.18 last month. 

Financial Markets Research


The morning market update is provided by: 

solutionsheadshots_hotchkiss_smJames Hotchkiss
Director, Member Strategy and Solutions

SolutionsHeadshots_Deven_smMelissa Deven
Director, Member Strategy and Solutions


The data and valuations provided in this document are for information purposes only and are provided as an accommodation and without charge. The Federal Home Loan Bank of Chicago makes no representations or warranties about the accuracy or suitability of any information in this document. This document is not intended to constitute legal, investment, or financial advice or the rendering of legal, consulting, or other professional services of any kind.

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