Bond Market Update

Short End Pulls Back

• U.S. Treasuries hold modest losses after slipping from their opening highs. Treasuries notched their best levels of the morning just as the market received the Retail Sales report for August (0.1%; Briefing.com consensus -0.2%), which showed slight growth against expectations for a modest decrease. That initial advance pressured yields on 10s and 30s to fresh lows for the year, but the entire complex slid from highs in immediate reaction to the data with shorter tenors leading the move. Equities are off to a strong start with the Nasdaq (+0.8%) trading ahead of the S&P 500 (+0.6%) after underperforming yesterday.
• Yield Check:
  • 2-yr: +5 bps to 3.61%
  • 3-yr: +5 bps to 3.47%
  • 5-yr: +5 bps to 3.45%
  • 10-yr: +3 bps to 3.65%
  • 30-yr: UNCH at 3.94%