Daily Market Color

Rates Stay Relatively Unchanged as Rising Virus Cases Weigh on Markets

Stocks continued their fall as rising virus cases outweighed stimulus optimism
Fears of more virus-related shutdowns pulled major indices lower on the day – the S&P 500 and DJIA fell 0.4% and 0.6%, respectively.  Treasury yields and swap rates ended the day relatively unchanged – the 10-year UST yield closed flat at 0.89%.
Loans were down 7% in November while deposits rose 14%
According to the Fed’s H.8 report, Commercial-and-industrial loan balances contracted 24% as banks processed forgiveness of PPP loans but were up 11.6% from last year.  Consumer loans grew 1%, driven mainly by an increase in auto loans. 
Pfizer vaccine distribution begins in the US after FDA approval
A New York nurse was among the first in the US to receive the vaccine, while other healthcare workers and nursing home residents are due to receive it in the coming weeks.  The pressure for rapid vaccine distribution continues to mount as the US still faces overcrowded hospitals.  Total fatalities have topped 300,000, the highest of any country.
Key events happening tomorrow
FOMC begins its two-day rate setting meeting.  Economists expect the bank to leave its benchmark rate unchanged but increase its monthly asset purchases.

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