US Economy and Credit Markets Ended Sept. 25, 2020
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Treasury yields dropped over the course of the week on increased Covid concerns in Europe and comments from the Federal Reserve. Cases in the United Kingdom, France and Spain have been picking up, prompting London Mayor Sadiq Khan to have talks for new restrictions aimed to slow the spread of the virus. On Tuesday, Fed Chairman Jerome Powell testified before congress and said another fiscal stimulus would be important to aid the economy. These calls for additional stimulus were echoed by other senior U.S central bank officials on Wednesday. This all led investors to seek the perceived safety of Treasurys and yields to fall. Investors also worried about a slower economic recovery as initial jobless claims on Thursday were 870k, compared to estimates of 850k, and continuing claims were 12.58m compared to estimates of 12.3m. Gold prices also dropped 5% over the week. Major economic reports (related consensus forecasts, prior data) for the upcoming week include Tuesday: September Conf. Board Consumer Confidence (89.8, 84.8); Wednesday: Sep 25 MBA Mortgage Applications (n/a, 6.8%), September ADP Employment Change (650k, 428k), 2Q T GDP Annualized QoQ (-31.7%, -31.7%), September MNI Chicago PMI (52.0, 51.2); Thursday: Sep 26 Initial Jobless Claims (850k, 870k), August Personal Income (-2.4%, 0.4%), August Personal Spending (0.7%, 1.9%). September Final Markit US Manufacturing PMI (53.5, 53.5), August Construction Spending MoM (0.6%, 0.1%), September ISM Manufacturing (56.2, 56.0); Friday September Change in Nonfarm Payrolls (580k, 1371k), September Unemployment Rate (8.2%, 8.4%), September Final U. of Mich. Sentiment (78.9, 78.9), August Factory Orders (1.0%, 6.4%), August Final Durable Goods Orders (n/a, 0.4%).
Posted on Monday, September 28, 2020 @ 8:43 AM

These posts were prepared by First Trust Advisors L.P., and reflect the current opinion of the authors. They are based upon sources and data believed to be accurate and reliable. Opinions and forward looking statements expressed are subject to change without notice. This information does not constitute a solicitation or an offer to buy or sell any security.