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Treasury yields are also pulling back.
The 2-yr note yield is up three basis points to 4.09% after hitting 4.12% recently.
The 10-yr note yield is down one basis point to 3.049% after hitting 3.52% recently.Treasury futures slipped out of the gate last evening and continued to fresh lows as the focus shifted to Europe, but the past three hours have seen a bounce that reclaimed the bulk of last night’s losses.
The biggest headline of the night came from OPEC+, as Saudi Arabia announced that it will reduce its oil output by 500,000 barrels a day while other producers will reduce their total output by 560,000 barrels a day. The news has sent the price of oil higher by nearly $5.00/bbl toward its January high.
Economic data released overnight showed a deepening contraction in the eurozone’s Manufacturing PMI while China’s Caixin Manufacturing PMI returned to 50.0, indicating no change in activity.
The market will also receive the latest IHS Markit Manufacturing PMI for the U.S. and the ISM Manufacturing Index this morning.
The U.S. Dollar Index is up 0.2% at 102.40.
Yields:
2-yr: +3 bps to 4.09%
3-yr: +1 bp to 3.84%
5-yr: +1 bp to 3.62%
10-yr: +1 bp to 3.50%
30-yr: -1 bp to 3.68%Early Bonds: U.S. Treasuries lower with shorter tenors relative weakness
Crude oil toward yesterday’s high (81.69)
Dollar Index down 0.1% at 102.02.Yields
2-yr: +3 bps to 4.02%
3-yr: +6 bp to 3.79%
5-yr: +3 bps to 3.56%
10-yr: +3 bps to 3.46%U.S. Treasuries trade on their highs after a swift bounce off their morning lows. The trading day started with modest losses across the curve and relative weakness up front, but the entire complex bounced into positive territory after the just-released Job Openings and Labor Turnover survey for February showed that job openings fell by more than 600,000. When compared to January’s unrevised total, job openings were down nearly 900,000 in February. The sharp fall will invite questions about the strength of the labor market, and by extension, the broader economy, which explains the bounce in Treasuries.
U.S. Treasuries finished Tuesday with gains across the curve after overcoming a soft start.
The turn in sentiment followed the release of the Job Openings and Labor Turnover survey for February, which invited new questions about the strength of the labor market. The survey showed that job openings fell by more than 600,000, and when compared to January’s unrevised total, openings were down by nearly 900,000 in February.
The report was met with a jump in Treasuries, which lifted all tenors into the green and was paced by big gains up front. Treasuries built on their gains into the early afternoon, finishing just below their best levels of the day.
Today’s advance sent the 30-yr yield back below its 200-day moving average (3.612%) to its lowest level in nearly three weeks while the 10-yr yield finished four basis points above its low from March (3.295%).
Yields:
2-yr: -15 bps to 3.84%
3-yr: -14 bps to 3.59%
5-yr: -14 bps to 3.39%
10-yr: -9 bps to 3.34%
30-yr: -5 bps to 3.59%Treasury yields took a turn lower in response to the trade and jobs data.
The 10-yr note yield, at 3.34% shortly before the release, is down three basis points to 3.30% and the 2-yr note yield, at 3.77% shortly before the release, is down nine basis points to 3.74%.
Yields:
2-yr: -11 bps to 3.73%
3-yr: -8 bps to 3.51%
5-yr: -7 bps to 3.32%
10-yr: -5 bps to 3.29%
30-yr: -3 bps to 3.56%Treasury yields moved noticeably higher in response to the jobless data release.
The 2-yr note yield, at 3.69% just before 8:30 a.m. ET, is up two basis points to 3.79% and the 10-yr note yield, at 3.26% just before the release, is up one basis point to 3.29%.
Initial jobless claims for the week ending April 1 decreased by 18,000 to 228,000 (consensus 203,000) from last week’s upwardly revised level of 246,000 (from 198,000) while continuing jobless claims for the week ending March 25 increased by 6,000 to 1.823 million from last week’s revised level of 1.817 million (from 1.689 million).
The key takeaway from the report is that it featured a revision to the seasonal adjustment factor, which resulted in big upward revisions to figures from recent weeks a sizable miss in this week’s report. That said, the higher level of claims will invite some questions about the strength of the labor market after last week’s release of the Job Openings and Labor Turnover survey for February showed a big drop in openings.
The four-week moving average for initial claims decreased by 4,250 to 237,750 from last week’s revised level of 242,000 (from 198,250).
The four-week moving average for continuing claims increased by 10,500 to 1,804,000 from last week’s revised level of 1,793,500 (from 1,691,750).
The total number of continued weeks claimed for benefits in all programs for the week ending March 18 was 1,905,334, a decrease of 1,183 from the previous week. In the same week a year ago, there were 1,728,353 weekly claims filed for benefits in all programs.Yields:
2-yr: -1 bp to 3.75%
3-yr: +1 bp to 3.55%
5-yr: -1 bp to 3.34%
10-yr: UNCH at 3.29%
30-yr: -1 bp to 3.55%U.S. Treasuries yields continue to respond to risk on/off pressures intraday in the short tenors and further out the curve to recessionary risks. This
[See the full post at: Bond Traders Weekly Outlook: 10 Year Yields at Year Lows with Cooling Economy]
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