Daily Market Color April 3, 2017Treasurys Rally as Stocks Fall with FOMC Minutes, Payrolls Friday Set for This Week US Treasurys added to last Friday’s rally in the first trading session of the week, as yields/swap rates fell 2-7 bps across the curve. The yield on the 10-year note shifted below 2.35% for the first time in over a month and is currently sitting near 2.33%. All three major US stock indices finished 0.05%-0.30% lower on the day after opening higher, with shares among auto manufacturers and retailers leading declines after sales during March came in weaker-than-expected. Crude oil prices edged roughly 0.5% lower, with WTI holding above $50/barrel, down $0.25 on the day. Yesterday OPEC Secretary General Mohammed Barkindo informed the public of Iraq’s assurance to comply with the agreed upon production cuts from earlier this year, but was unable to confirm a commitment to an extension of the freeze. This week financial markets will pay close attention to Wednesday’s release of the minutes from the FOMC’s March meeting in search of guidance on the future path of interest rate hikes in addition to a timeline for a reduction the Fed’s balance sheet. On Friday, nonfarm payroll figures for March will be reported, with expectations for an addition of 175,000 jobs along with the unemployment rate holding steady at 4.7%. As reported by the Institute for Supply Management (ISM) this morning, factory activity in the US remained robust during the month of March. The ISM Manufacturing Index recorded a 57.2 reading, marginally lower than the previous month’s 57.7 level, but well above the threshold associated with expansion in the sector (50). Last month’s figure represents the seventh consecutive month above 50, as 17 of the 18 industries monitored in the survey displayed growth. Detailed in the report, both the new orders and production indices fell slightly to 64.5 and 57.6, respectively, while the employment index surged to its highest mark since 2011 at 58.9.