May 8, 2020 - Market Update

The Fed purchase schedule today includes a maximum of $2.2B GNII and then later a maximum of $3.960B FN30 year securities.

Treasuries rallied heavily driven by investor concern that the U.S. central bank will cut rates into negative territory.  At the close, the 2-year was +2+/32nds (.141) and the 10-year was +20+/32nds (.644).  

Stocks rallied on Thursday as investors were optimistic that the worst of the economic hit from the virus has passed.  The Initial Jobless Claims number showed a loss of 3.169m but it was an improvement from last week.  The DJIA closed +211.25 to 23,875.89, while the S&P 500 was +32.77 to 2,881.19.

The US economy lost 20.5 million jobs in April, the Bureau of Labor Statistics said Friday — by far the most sudden and largest decline since the government began tracking the data in 1939. The unemployment rate soared to 14.7%, its highest level since the BLS started recording the monthly rate in 1948. The last time American joblessness was that severe was the Great Depression: The unemployment rate peaked at 24.9% in 1933, according to historical annual estimates from the BLS.

However, it beat expectations. Expectations were showing a -22 million drop in the nonfarm payrolls and an increase to 16% on the unemployment rate.