Daily Market Color February 6, 2020Rates Continue to Climb as a Potential Coronavirus Cure Emerges Rates continue to bounce higher as coronavirus fears ease and China cuts tariffs on American imports. Yields and swap rates rose across the curve yesterday on reports that Gilead’s Remdesivir and choroquine drugs may be effective against the coronavirus (though the WHO has downplayed those reports). The 10-year Treasury yield would ultimately climb 5 basis points to close at 1.65% yesterday, while the S&P 500 would close at a record high. This morning, equity futures point to a higher open as China has said it will lower tariffs on $75B of US goods. Russia rejects OPEC push to cut oil production amid coronavirus-driven demand shock. Russia will not cooperate with Saudi Arabia and the rest of OPEC’s push to cut oil production. OPEC had hoped that an output cut would help support oil markets in light of a sharp downturn in demand, but Russian delegates suggested it’s too early to assess the impact of the virus on global demand. Crude oil has fallen nearly 20% from its peak in late-2018 to $50.83/barrel. Day ahead. This morning, the US Labor Department published December productivity numbers. Economists expected gains after a third quarter decline of 0.2% and the numbers were in-line with forecasts at 1.4%. The jobs report also showed a decline in jobless claims at 202,000, approximately 15,000 lower than the previous results. The EIA Natural Gas Report will follow. Dallas Fed President Robert Kaplan and Fed Governor Randal Quarles are today’s scheduled speakers. Twitter and Uber are among the companies reporting earnings today.