Bonds Generally Unchanged

U.S. Treasury prices were knocked around unchanged Friday while stocks stalled in typical light-volume summer trade following a mix of data and a batch of Federal Reserve speakers. A mixed bag of reports showed sizable misses on both services and manufacturing Purchasing Managers’ indices (PMI) in June while the volatile new home sales data surged in May.The 30-year yield has been stuck near 2.725%, held in a tight range of 2.7163% and 2.7397%, from a 2.724% close Thursday The 10-year yield stalled near 2.155% within a range of 2.1485% and 2.165% from a 2.153% close. The five-year yield has hugged the 1.765% level in a 1.7532% to 1.7765% range. The two-year yield was strapped to the 1.34% level from 1.344% Thursday.

The curve trade has been narrowly mixed with some unwinding of flattening positions, with the spread between the two- and 10-year yields steepened to 81.5 from 80.6, after having hung around the tightest levels since September. The five- and 30-year yield gap has held near unchanged around 96, but worked itself to a wider 96.9 earlier and remains near level last seen in 2007. Early data had preliminary June Markit services PMI falling to 53.0 versus the expected 53.7 while manufacturing fell to 52.1 against 52.7. On the plus side, the numbers remain higher on the year and and the employment inputs rose.

Leave a Comment