Sector Update

June 28, 2021



Treasury yields ended last week solidly higher across the curve in a steeper move. Short and intermediate yields moved in a less dramatic fashion than the week prior and were 1-4 bps higher. Maturities 7-years and longer moved 7-13 bps higher. Last week, among numerous other Fed speakers, saw taper discussions early on Monday morning with comments from the Fed’s Bullard and Kaplan.

Bullard: could easily argue “at any time” that the economy has made the “substantial further progress” necessary to taper bond purchases. However, officials are “only now starting” those discussions and that it “will take some time to get that organized….”

Kaplan: would prefer tapering “sooner rather than later”

It seems the consensus among Fed officials is that they’re on board with higher current inflation being transitory. At the same time, more are acknowledging risk to the upside. It makes sense then that talks of tapering are becoming more public.



Upcoming Webinars – (1 hour CPE available)

General 7/13: 3rd Quarter Economic Outlook Webinar


Today – Yields retreat from Friday, curve flatter, stocks mixed


Yields end week higher – led by longer maturities in a move steeper


5-year yield closed at second highest level of the year


Yield Curve Shape – 2s-5s remains in recent ranges, 2s-10s pushes back but still under pressure






Sector Commentary (click on links for more in-depth look)



What We’re Reading


Market Today | Daily

Weekly Recap | Weekly, Friday

Brokered Deposit Rate Indications | Weekly, Monday

Investment Alternatives Matrix | Weekly, Tuesday

MBS Prepay Commentary (June) | Monthly, 5th business day

SBA Prepay Commentary (June) | Monthly, 10th business day


WSJ: Fed Officials Debate Scaling Back Mortgage-Bond Purchases at Faster Clip

“Other Fed officials argue against the idea, saying the combined purchases of mortgage and Treasury securities lower long-term interest rates overall—not just mortgage rates. They say other factors are contributing to the hot housing market, including a dearth of homes for sale relative to strong demand.”


Vining Sparks: Coronavirus Chartbook


INTENDED FOR INSTITUTIONAL INVESTORS ONLY.
The information included herein has been obtained from sources deemed reliable, but it is not in any way guaranteed, and it, together with any opinions expressed, is subject to change at any time. Any and all details offered in this publication are preliminary and are therefore subject to change at any time. This has been prepared for general information purposes only and does not consider the specific investment objectives, financial situation and particular needs of any individual or institution. This information is, by its very nature, incomplete and specifically lacks information critical to making final investment decisions. Investors should seek financial advice as to the appropriateness of investing in any securities or investment strategies mentioned or recommended. The accuracy of the financial projections is dependent on the occurrence of future events which cannot be assured; therefore, the actual results achieved during the projection period may vary from the projections. The firm may have positions, long or short, in any or all securities mentioned. Member FINRA/SIPC.
Copyright © 2021
Member FINRA/SIPC
This is a publication of Vining-Sparks IBG, L.P.
775 Ridge Lake Blvd., Memphis, TN 38120