Bond Market Update

Monday Levels Revisited

• U.S. Treasuries trade a bit above their lows with shorter tenors continuing their early underperformance. The trading day started in largely flat fashion, but the entire complex retreated after this morning's initial batch of data was headlined by a much stronger than expected Retail Sales report for July (1.0%; Briefing.com consensus 0.3%). The post-data selling sent yields back to their opening levels from Monday with most tenors remaining a bit below those levels while the 2-yr note underperforms. Equities are off to a strong start, building on this week's gains with the S&P 500 (+1.0%) now up 3.1% since Friday's settlement.
• Yield Check:
  • 2-yr: +13 bps to 4.08%
  • 3-yr: +12 bps to 3.88%
  • 5-yr: +12 bps to 3.79%
  • 10-yr: +11 bps to 3.93%
  • 30-yr: +8 bps to 4.19%