U.S. Treasuries started June with losses in most tenors, finishing the session closer to the day’s opening levels than session lows.
Treasuries started with modest losses across the curve after the weekend featured some renewed uncertainty surrounding peace negotiations with Iran. The U.S. carried out strikes against Iran over the weekend, sending the price of oil back above $90/bbl while also weighing on Treasuries. The early losses were extended in the late morning after it was reported that Iran suspended peace negotiations with the U.S. due to Israel striking Hezbollah targets in Lebanon.
The selling that followed lifted yields back to last week’s highs, but a midday rebound took shape after President Trump said that Israel’s hostilities toward Lebanon will stop. The rebound lifted the long bond into positive territory while 10s and shorter tenors finished the day with losses.
Crude oil hit a session high just below $95/bbl before narrowing its gain
U.S. Dollar Index rose 0.3% to 99.19, bouncing off its 50-day moving average (98.90).
Yield:
2-yr: +4 bps to 4.05%
3-yr: +4 bps to 4.10%
5-yr: +4 bps to 4.19%
10-yr: +2 bps to 4.48%
30-yr: UNCH at 4.99%