Daily Market Color April 19, 2021Long-term Rates Little Changed, Remain 20 Bps Below Recent Highs Treasury yields and swap rates rise on the day, remain 20+ bps below recent highs Treasury yields and swap rates rose marginally in an otherwise quiet session, the 10-year Treasury yield rising 2 basis points to close at 1.60%. While rates were higher on the day, they remain sharply below recent highs, having fallen nearly 20 basis points since the start of the month. Interestingly, the decline in rates has not been accompanied by a decline in inflation expectations as the market continues to imply an inflation rate near 2.5% over the next 10 years. US equities pare gains as earnings season continues Banks continued to report second-quarter results as earnings season continues in earnest. Subdued loan growth and record low loan to deposit ratios continue to be the theme of earnings thus far, though those headwinds were somewhat offset by declines in credit provisions for bad loans. Additionally, PPP lending continued to be a boon for community and regional banks, fee income on those deals helping to offset some of the declines in loan growth. The S&P Regional Banking Index fell slightly on the day but is up nearly 31% YTD. Financial institutions will continue to be the focus of the market for the rest of the week as nearly 80 companies report results. Total global COVID-19 infections rose past 5.2 million last week, a pandemic record Global cases of COVID-19 continue to rise despite global vaccination efforts, totaling 5.2mm last week. Thus far, COVID-19 cases remain below peak levels in the United States where 211 million vaccine doses have been given. According to the CDC, vaccinations are proving to be effective, as fewer than 6,000 people who are fully vaccinated have contracted the virus. For the time being, distribution of the Johnson & Johnson vaccine remains paused, though the CDC is expected to make a decision on the vaccine later this week.