Treasury Market Outlook: Treasury yields have dropped from overnight highs
Treasury Market Outlook: Treasury yields have dropped from overnight highs and are about 2 bps richer with the 2-year at 1.658%, with the wi 10-year at 1.720%. Core European rates have also declined, leaving the Bund 1 bp lower at -0.562%, while the Gilt is 1 bp higher at 0.645% as some BoE easing expectations are unwound. Asian rates were cheaper at the close with the JGB 2.3 bps higher at -0.213%. Stocks have rallied with the FTSE leading the way with a 0.9% gain on reduced Brexit jitters. U.S. futures are about 0.1% firmer. The Nikkei rallied 0.9%, but Chinese shares closed in the red with the CSI 300 off -0.7%. The departure of NSA's Bolton yesterday helped underpin risk appetite, as did news China will allow some exemptions to additional tariffs on U.S. imports. There wasn't much data overnight and the U.S. calendar has the $24 B 10-year note reopening and data on August PPI, July wholesale trade and weekly oil inventories. The MBA reported mortgage applications rose 2.0% in the September 6 week.