It's Friday and that means it's time to be on the lookout for unexpected trade-related headlines, especially in the afternoon.  Those sorts of newswires and tweets have become almost predictable at the end of any given week, but markets have increasingly taken them with a grain of salt.  Case in point, last week's major motivation for stock gains and bond market weakness was the notion that previously announced tariffs would be rolled back as a part of the phase 1 trade deal.  The biggest move followed an announcement to that effect from China's commerce minister.  But when Trump pushed back on those headlines on Friday, it did little to undo what had already been done (though it definitely moved markets).

Before we get to the point in the day where such headlines become a bigger risk, we'll have to get through the week's most important piece of economic data in the form of Retail Sales.  The "strength of the consumer" is a well-documented story during this stage of the economic expansion.  Consumer sentiment and spending is probably the biggest hook upon which the domestic economy can hang its hat at the moment.  That actually works in our favor to some extent because traders are more likely to trade aggressively in the event of a big miss in Retail Sales (that would be the bigger surprise than strength).  That said, this report hasn't garnered as much of a response as a few other reports (like ISM data) recently.

In general, bonds will be attempting to hold inside the previous consolidation range--the one that was broken at the end of last week.  This week has been all about deciding whether or not we would overlook that breakout due to the confluence of a 3-day holiday weekend and its uncommon coincidence with the biggest corporate bond offering of the year.

20191115 open


MBS Pricing Snapshot
Pricing shown below is delayed, please note the timestamp at the bottom. Real time pricing is available via MBS Live.
MBS
FNMA 3.0
101-08 : -0-03
Treasuries
10 YR
1.8380 : +0.0230
Pricing as of 11/15/19 8:28AMEST

Tomorrow's Economic Calendar
Time Event Period Forecast Prior
Friday, Nov 15
8:30 Retail Sales (%)* Oct 0.2 -0.3
8:30 Export prices mm (%)* Oct -0.1 -0.2
8:30 Import prices mm (%)* Oct -0.2 0.2
8:30 NY Fed Manufacturing Nov 5.00 4.00
9:15 Capacity Utilization (%) Oct 77.1 77.5
9:15 Industrial Production (%) Oct -0.4 -0.4
10:00 Business Inventories (% ) Sep 0.1 0.0