Morning Market Update: March 22, 2019

Yield Curve Flattens in Equity Strength

Commentary for Thursday: Treasurys mostly sold off while equities increased. Yields were initially higher in choppy overnight trading and shifted higher following the release of economic data that reported a stronger-than-expected Philadelphia Fed Business Outlook and a decline in jobless claims. They were choppy the remainder of the morning with three Treasury auctions. Yields trended higher into the afternoon and stabilized before close 1-2 basis points higher in the short end of the curve and less than a basis point lower in the long end. 

This Morning: Treasury yields are shifting lower ahead of economic data to be released on home sales. 

Initial jobless claims decreased by 9K week-over-week to 221K, while the prior week’s level was upwardly revised from 229K to 230K. Despite the weekly decline, the 4-week moving average edged higher by 1K to 225K. Continuing claims decreased by 27K to 1.750M. The previous week’s level was upwardly revised by 1K to 1.777M. The 4-week moving average increased by 6K to 1.772M. The insured unemployment rate held steady at 1.2%.

The Philadelphia Fed Business Outlook unexpectedly jumped 17.8 points to 13.7 in March after falling 4.1 points the month prior. New orders increased 1.9 points, shipments jumped 20.0 points, and hiring rose 9.6 points. However, the six month outlook on new orders fell 10.5 points to 21.8, the lowest reading since February 2016.

Financial Markets Research
03212019 

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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