Morning Market Update: February 19, 2020

 

Yields and Equities Both Fall in Choppy Trading Day

Commentary for Monday: Treasurys rallied while equities dropped in a choppy trading day. Yields were down in overnight trading following an announcement by Apple warning that it doesn't expect to meet revenue target due to lower smart-phone demand following the coronavirus outbreak in China. Yields stabilized and rose slightly in the morning following treasury auction issuance. They ended the day down 1-2 basis points across the curve.

This Morning: Yields are rising across the curve following the release of better-than-expected economic data.

The NAHB Housing Market Index unexpectedly fell one point to 74 in February compared to consensus expectations of 75 or same figure as January. Weighing on the index were 1 point declines in 3 of the major components including present sales, traffic of prospective buyers, and future sales. Regional data was mixed with the Midwest and West growing 5 and 4 points, while the Northeast and South declined 5 and 2 points respectively.

Treasury International Capital (TIC) inflows from net foreign purchases of long-term U.S. assets grew to $78.2B in December 2019. November's figure was upwardly revised to $77.3B from $73.1B. Net purchases of Treasury bond reached $48.7B vs. a decline of $15.7B the month prior. However, net corporate bond purchases resulted in a decline of $17.1B vs. growth of $10.2B the prior month. 

02182020


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





Disclaimer

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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