Holding Onto Hopes Of Stimulus Bill In Near Term

Early rate support evaporated quickly Wednesday -- despite weaker than anticipated private ADP employ data: +307k vs +440k exp, offset by a higher Oct revision: +404K vs. +365K.

• Nascent risk appetite ensued at varying degrees through the session, driven again by hopes of a fiscal stimulus agreement in the near term. Building "momentum" over an $908B bipartisan relief bill apparently behind late session duration drop in Tsys, futures making new session lows/equities moving higher.
• Tsys bounced right back to prior levels, equities trimmed gains, one desk posited that "unless McConnell changes his shell, it doesn't matter what Pelosi and Schumer say they support." Deja vu.
• Fed's latest Beige Book shows some sign of deterioration in outlook compared to October's reading of anecdotal reports from central bank business contacts.
• Little if any market reaction to multiple Fed speakers on the day. The 2-Yr yield is down 0.4bps at 0.1623%, 5-Yr is up 0.5bps at 0.4209%, 10-Yr is up 2bps at 0.9459%, and 30-Yr is up 3.3bps at 1.7011%.