Bond Market Update

Data Recon

• Factory orders declined 0.5% month-over-month in September (Briefing.com consensus -0.4%) following a downwardly revised 0.8% decline (from -0.2%) in August. Excluding transportation, factory orders rose 0.1% on the heels of a 0.2% decline in August. Shipments of manufactured goods fell 0.4% in September following a 0.7% decline in August.
  • The key takeaway from the report is that transportation equipment orders (-3.1%), led by weakness in nondefense aircraft and parts orders (-22.7%) and defense aircraft and parts orders (-23.7%), were the primary basis for the decline in factory orders in September.
• Yield Check:
  • 2-yr: -7 bps to 4.13%
  • 3-yr: -8 bps to 4.10%
  • 5-yr: -9 bps to 4.12%
  • 10-yr: -9 bps to 4.27%
  • 30-yr: -10 bps to 4.46%