December 6, 2023
Over in bond land, Treasury yields are higher before the opening bell Wednesday, ahead of October’s trade balance and the final reading for the third quarter’s non-farm productivity data releases. The yield on the 10-year note is rising four basis points (0.04%) to 4.20%, while the 30-year bond yield is increasing two basis points (0.02%) to 4.32%. The yield on the two-year note, which is more sensitive to changes in monetary policy, is up four basis points (0.04%) to 4.62%.
Treasury yields were lower on Tuesday, as investors evaluated U.S. job openings for October, which came in well below expectations. The yield on the 10-year note was down nine basis points (0.09%) to 4.16%, while the 30-year bond yield fell 11 basis points (0.11%) to 4.30%. The yield on the two-year note decreased six basis points (0.06%) to 4.58%.
On the data front today, Mortgage Bankers Association (MBA) mortgage applications increased 2.8% for the week ending December 1 versus the prior week’s increase of 0.3%. The Automatic Data Processing (ADP) employment change for November is expected to be 130,000, higher than the previous month’s 117,000. The final reading for the third quarter’s non-farm productivity is expected to increase 4.9% versus the prior reading of 4.7%, while the final reading for the third quarter’s unit labor costs is expected decrease an annualized 0.9% versus the prior reading of negative 0.8%. The trade balance for October is projected to record a negative $64.2 billion versus the previous month’s negative $61.5 billion. The Department of Energy (DOE) crude oil inventories are anticipated to decrease by 1.6 million barrels for the week ending December 1 versus the prior week’s increase of 1.6 million barrels.
In the auction space, the U.S. Treasury is set to issue $56 billion in 17-week bills.
Municipal Market Commentary
The Bloomberg 30-day visible supply rose $1.981 billion to $13.446 billion on Tuesday, above the 12-month average of $8.662 billion.
This information is obtained from sources and data considered to be reliable, but its accuracy and completeness is not guaranteed by Wells Fargo Advisors. Additional information available by request.
Wells Fargo Advisors is registered with the U.S. Securities and Exchange Commission and the Financial Industry Regulatory Authority, but is not licensed or registered with any financial services regulatory authority outside of the U.S. Non-U.S. residents who maintain U.S.-based financial services account(s) with Wells Fargo Advisors may not be afforded certain protections conferred by legislation and regulations in their country of residence in respect of any investments, investment transactions or communications made with Wells Fargo Advisors.
Wells Fargo Advisors is a trade name used by Wells Fargo Clearing Services, LLC and Wells Fargo Advisors Financial Network, LLC, Members SIPC, separate registered broker-dealers and non-bank affiliates of Wells Fargo & Company.