Bond Market Update

Short End Leads Early Pullback

• U.S. Treasuries trade with slim losses in most tenors after dipping from their opening levels. The market did not receive the weekly Initial Claims report today due to the ongoing shutdown. It did receive the September Challenger Job Cuts report, which is not know for eliciting a response from the market, but given the elevated concerns about the labor market and the lack of other employment-related data, it likely received a bit more attention. The report showed that job cuts in September were down 25.8% year-over-year after being up 13.3% year-over-year in August. The early pullback from highs has been paced by the short end while the long end has put up more resistance with the 30-yr bond hanging onto a slim gain. Equities are off to a slightly higher start with the S&P 500 (+0.1%) setting another record high.
• Yield Check:
  • 2-yr: +2 bps to 3.56%
  • 3-yr: +1 bp to 3.57%
  • 5-yr: +2 bps to 3.70%
  • 10-yr: +1 bp to 4.11%
  • 30-yr: -1 bp to 4.71%