Treasury Market Outlook: bond yields have tumbled as risk appetite declines
Treasury Market Outlook: bond yields have tumbled as risk appetite declines after Italian angst picks up and rekindles Eurozone breakup fears. The Treasury 10-year rate is down 2 bps at 3.063%, with the 2-year off 1.2 bps to 2.807%. Bund and Gilt yields are 3.6 bps lower at 0.434% and 1.551%, respectively. Italy's BTP has risen 5 bps to 3.34%. European bourses are in the red. The DAX has slumped 0.8%, with the FTSE off 0.4%. Peripherals have weakened with Italy down 0.6% and Spain off 0.95%. Chinese markets remained on holiday, but the Hang Seng fell nearly 2.4%. EMU August PPI came in above expectations at 4.2% y/y, while UK September construction PMI fell to a 6-month low. The RBA left rates unchanged as expected. The U.S. calendar is light with just September auto sales and weekly chain store sales. There's Fedspeak from Chairman Powell, Quarles, and Kaplan. Today's earnings include Paychex and Pepsico.