Bond Market Update

Dipping Ahead of Delayed Jobs Report

• U.S. Treasuries are on track for a lower start, seeking a continuation of yesterday's late retreat that left Treasuries on low. Treasury futures retreated in early evening action as capital markets cheered the release of the latest quarterly results from NVIDIA (NVDA). The rest of the night saw a couple short-lived bounce attempts, but recent trade has featured a dip to fresh lows. The retreat in U.S. Treasuries comes alongside some pressure on other sovereign debt and solid gains in most global equity markets. The overnight data flow was on the light side, but the market will receive the long-delayed Employment Situation report for September at 8:30 ET. Crude oil is recovering some of yesterday's loss while the U.S. Dollar Index is up 0.1% at 100.30.
• Yield Check:
  • 2-yr: +1 bp to 3.61%
  • 3-yr: +1 bp to 3.60%
  • 5-yr: +1 bp to 3.72%
  • 10-yr: +1 bp to 4.14%
  • 30-yr: +1 bp to 4.76%

• News:
  • The People's Bank of China left its one-year and five-year loan prime rates at their respective 3.00% and 3.50%, as expected.
  • China's rare earth magnet exports to the U.S. in October were up 56% month-over-month.
  • China banned imports of beef from Japan.
  • European Central Bank policymaker Makhlouf said that he is comfortable with the central bank's current policy stance, echoing recent comments from other governing council members.
  • Belgium's budget minister Vincent Van Peteghem is reportedly a frontrunner to become the new Eurogroup chief after the recent resignation of Pascal Donohoe.
  • Hong Kong's October CPI was up 0.3% m/m (last 0.1%), rising 1.2% yr/yr (last 1.1%).
  • Germany's October PPI was up 0.1% m/m (expected 0.0%; last -0.1%) but was down 1.8% yr/yr (expected -1.9%; last -1.7%).
  • U.K.'s November CBI Industrial Trends Orders rose to -37 from -38 (expected -33).
  • Swiss October trade surplus reached CHF4.319 bln (expected surplus of CHF4.76 bln; last surplus of CHF3.99 bln).
• Commodities:
  • WTI Crude: +1.0% to $60.03/bbl
  • Gold: -0.2% to $4075.50/ozt
  • Copper: +0.1% to $5.026/lb
• Currencies:
  • EUR/USD: -0.3% to 1.1508
  • GBP/USD: UNCH at 1.3057 
  • USD/CNH: UNCH at 7.1188
  • USD/JPY: +0.4% to 157.71
• Data out Today:
  • 8:30 ET: September Nonfarm Payrolls (Briefing.com consensus 50,000; prior 22,000), Nonfarm Private Payrolls (Briefing.com consensus 58,000; prior 38,000), Unemployment Rate (Briefing.com consensus 4.3%; prior 4.3%), Average Hourly Earnings (Briefing.com consensus 0.3%; prior 0.3%), Average Workweek (Briefing.com consensus 34.3; prior 34.2), November Philadelphia Fed survey (Briefing.com consensus 2.0; prior -12.8), and weekly Initial Claims (Briefing.com consensus NA; prior NA) and Continuing Claims (prior NA)
  • 10:00 ET: October Existing Home Sales (Briefing.com consensus 4.08 mln; prior 4.06 mln) and October Leading Indicators (prior NA)
  • 10:30 ET: Weekly natural gas inventories (prior +45 bcf)