Bond Market Update

Shorter Tenors Maintain Lead

• U.S. Treasuries continue trading near their opening levels after a sideways start to the Friday session. The trading day started with a firmly higher open in the 2-yr note while longer tenors started just above yesterday's closing levels. The market reached fresh highs about an hour after the cash start, followed by a pullback that returned action toward levels seen at the open. The sleepy start is not surprising given today's light economic data slate, which was headlined by the just-released preliminary reading of the University of Michigan's Consumer Sentiment survey for September, which increased to 69.0 from 67.9 in August. Equities are off to a higher start with the S&P 500 (+0.4%) and Nasdaq (+0.5%) extending this week's gains to 5.8% and 3.9%, respectively.
• Yield Check:
  • 2-yr: -6 bps to 3.59%
  • 3-yr: -4 bps to 3.44%
  • 5-yr: -2 bps to 3.44%
  • 10-yr: -1 bp to 3.67%
  • 30-yr: +1 bp to 4.00%