Ok one more time ….
U.S. Treasuries sit on their lows with shorter tenors remaining behind. Treasuries opened the day on a sharply lower note while recent trade saw 10s and 30s slip to fresh lows. Equities started the day on a weak note with the S&P 500 (-2.7%) staying a bit ahead of the Nasdaq (-3.1%). Last week, the market saw a jump in expectations for the possibility of a 75-bps rate hike on Wednesday.
The fed funds futures market ended last week with a 21.3% implied likelihood of a 75-bps increase and the implied probability of such a move increased to 30.0% today. High-yield debt is showing notable weakness with the iShares iBoxx High Yield Corporate Bond ETF (HYG 73.02, -2.61, -3.5%) falling to its lowest level since March 2020.
