Record Tail 3.3 bps in U.S. 20-year Treasury Bond Auction Fuels Bond Sell Off

U.S. Treasuries fell to fresh lows in immediate reaction to weak demand at the $16 billion 20-yr Treasury bond auction. The sale drew a high yield of 4.595%, which tailed the when-issued yield by 3.3 bps a record tail in auctions of this tenor. The bid-to-cover ratio (2.39x vs 2.62x average) and indirect takedown (59.1% vs 69.5%) were well below average. Post-auction saw the 30-yr yield higher by nearly three basis points and the 10-yr yield up two basis points … Continue reading “Record Tail 3.3 bps in U.S. 20-year Treasury Bond Auction Fuels Bond Sell Off”

AI Swinging for The Fences – Traders Market Weekly

Feb 18-24, 2024 FEAR NOT Brave Investors Where have we been and where are we going? Join our weekly market thread on Traders Community… The Week That Was – What Lies Ahead? Contents Click on the links below to navigate to the relevant section. Editorial Hallmarks of previous manias were in abundance this week, from the shrugging off violent selloffs on Tuesday in bonds and stocks after a hot CPI to ramped stocks like SMCI, NVDA and ARM to name … Continue reading “AI Swinging for The Fences – Traders Market Weekly”

CPI and PPI Reversal of Deflationary Process – Bond Market Review

U.S. Treasuries closed the week on a lower note, in a somewhat feral week ten-year Treasury yields rose 10 basis points to 4.28%, but it could have been so much worse. Yields closing back toward highs reached Tuesday after January’s CPI data confirmed inflation is not in dead in the water. Headline inflation rose 0.3% for the month versus the 0.2% expected. Year-over-year headline inflation was at 3.1% compared to expectations of 2.9%. Core (ex-food and energy) CPI rose stronger … Continue reading “CPI and PPI Reversal of Deflationary Process – Bond Market Review”

China and America, a Tale of Two Markets – Traders Market Weekly

Feb 11-17, 2024 FEAR NOT Brave Investors Where have we been and where are we going? Join our weekly market thread on Traders Community… The Week That Was – What Lies Ahead? Contents Click on the links below to navigate to the relevant section. Editorial While stock markets in America, Australia, France and Germany have all tagged record highs in this thrust higher a huge point of difference is while U.S. equities are in the throes of a major speculative … Continue reading “China and America, a Tale of Two Markets – Traders Market Weekly”

Abundant Marketplace Liquidity and Easy Credit Availability – Bond Market Review

Friday saw a repeat for U.S. Treasuries closing out the week on a sharply lower note, yields on the 10-yr note and shorter tenors went their highest closing levels since mid-December while the long bond outperformed, keeping its yield three basis points below its highest close from last month. We saw the same last Friday with yields coming off their lowest levels of the year after the red-hot January jobs report showed headline growth of 353,000, twice as high consensus. … Continue reading “Abundant Marketplace Liquidity and Easy Credit Availability – Bond Market Review”

Impressive 30-year Treasury Bond Sale Completes Strong Week of Auctions

The U.S. Treasury completed this week’s note and bond auction offerings today with another strong auction. U.S. Treasuries rallied off afternoon lows back to their starting levels after the U.S. Treasury’s $25 billion 30-yr bond sale. The auction drew a high yield of 4.360%, which stopped through the when-issued yield by two basis points. The bid-to-cover ratio (2.40x) was comfortably above average (2.38x), as was indirect takedown (70.7% vs 67.8% average). The S&P 500 continues to hover near record highs … Continue reading “Impressive 30-year Treasury Bond Sale Completes Strong Week of Auctions”

10-year Bond Auction Sees Strong International Takedown

U.S. Treasuries came off afternoon lows in reaction to strong demand at the $42 billion 10-yr Treasury note auction. The sale followed yesterday’s strong 3-yr note offering. The sale drew a high yield of 4.093%, which stopped through the when-issued yield by 1.2 bps while the bid-to-cover ratio (2.56x vs 2.49x average) and indirect takedown (71.0% vs 66.7%) were comfortably above their respective prior 12-auction averages. However, the 5-yr note and longer tenors continue with small losses while shorter tenors … Continue reading “10-year Bond Auction Sees Strong International Takedown”

Bonds Bounce After Sharp Losses Following Strong 3-year Treasury Note Auction

U.S. Treasuries traded to fresh highs after the completion of today’s $54 bln 3-yr note sale, which met strong demand. U.S. bonds climbed on Tuesday, bouncing from two days of sharp losses. No U.S. economic data on today’s calendar helped also. The sale drew a high yield of 4.169%, which stopped through the when-issued yield by a solid 0.8 bps while the bid-to-cover ratio (2.58x vs 2.68x) was below average. Indirect takedown (66.0% vs 63.1%) was solid. Issues in the … Continue reading “Bonds Bounce After Sharp Losses Following Strong 3-year Treasury Note Auction”

Rates React to Fed and Strong Jobs – Bond Market Review

U.S. Treasuries closed out the week on a sharply lower note, yields coming their lowest levels of the year after the red-hot January jobs report showed headline growth of 353,000, twice as high consensus. The report fed the rationale that the Fed will maintain its hawkish rhetoric. Notably Chicago Fed President Goolsbee said that the report will not influence policy in the near term, noting that the drop in the average workweek to 34.1 hours from 34.3 hours reflected weakness … Continue reading “Rates React to Fed and Strong Jobs – Bond Market Review”

The Dislocation of War and Markets – Traders Market Weekly

Feb 6-12, 2024 FEAR NOT Brave Investors Where have we been and where are we going? Join our weekly market thread on Traders Community… The Week That Was – What Lies Ahead? Contents Click on the links below to navigate to the relevant section. Editorial This week brought a powerful reminder how disconnected financial markets can be, particularly those in the US are from factors that either don’t directly affect them or unrelated to stock prices. The world was at … Continue reading “The Dislocation of War and Markets – Traders Market Weekly”