|10-Year: +1/32....%.... GNMAs: .... USD/JPY: 113.64.... EUR/USD: 1.1350|
--President Trump and President Xi agree to suspend further tariff actions for 90 days to allow more time for trade negotiations
--Market recoups early losses; 10-yr yield back below 3.00%
--November ISM Manufacturing Index: Actual 59.3, Briefing.com consensus 57.2, Prior 57.7
--October Construction Spending: Actual -0.1%, Briefing.com consensus +0.3%, Prior revised to -0.1% from 0.0%
- The Treasury market is holding its own in the face of a relatively strong stock market today. It is also holding on to a curve-flattening bias.
- The 10-2 spread has narrowed three basis points to 17 basis points in a move dictated by buying interest at the long end. The 10-yr yield has dropped two basis points to 2.99% while the 2-yr note yield has increased one basis point to 2.82%.
- The move at the back end has occurred in spite of oil prices jumping 3.5% today to $52.71/bbl amid a rebound from short-term oversold conditions that has been helped by reports of Alberta cutting its daily production by 325,000 barrels per day and speculation that there will be a supply cut announced at the December 6 OPEC meeting, which will also include Russia.
- Yield check:
- 2-yr: +1 bp to 2.82
- 5-yr: -1 bp to 2.83%
- 10-yr: -2 bps to 2.99%
- 30-yr: -3 bps to 3.28%