Bond Market Update

Defending Starting Gains

• U.S. Treasuries hover near their opening levels after a quick dip from their starting highs. Treasuries followed their higher open with an upward push that had the 10-yr yield down seven basis points just 30 minutes after the start, but the extension of starting gains was quickly reversed, returning action to today's starting levels. Economic data released shortly after the cash open showed a small uptick in weekly jobless claims (to 206,000 from 204,000) and a slight downward revision to Unit Labor Costs for Q2 (to 1.2% from 1.3%). The early extension of gains pressured yields back to their opening levels from last Friday, but the bulk of that move has been undone. Equities are off to a higher start, returning the Nasdaq (+0.9%) and S&P 500 (+0.5%) to little changed for the week.
• Yield Check:
  • 2-yr: -6 bps to 4.33%
  • 3-yr: -5 bps to 4.40%
  • 5-yr: -5 bps to 4.51%
  • 10-yr: -4 bps to 4.76%
  • 30-yr: -3 bps to 5.24%