Treasury Market Outlook: bonds have extended declines as risk appetite was boosted
Treasury Market Outlook: bonds have extended declines as risk appetite was boosted by an increasingly optimistic trade outlook. Treasury yields are up 2 to 4 bps with the 2-year at 1.576% and the benchmark 10-year at 1.75%. EGB rates are up 1 to 2 bps. Trading was thinned, however, by a holiday in Japan. U.S. Commerce Secretary Ross reiterated yesterday good progress was being made on a Phase One deal with China. Additionally he suggested the U.S. may not need to impose auto tariffs on imported vehicles following "good conversations" with EU automakers. Fiat Chrysler has led a 1.5% rally in the Italian MIB and the DAX is up 1.15%, while the FTSE 100 had gained 1%. U.S. futures are up 0.5% after record highs on the S&P 500 last week. The CSI finished 0.65% higher. Also supporting gains in European bourses was the jump up in the Sentix Euroone economic index, along with an upward revision in the Eurozone manufacturing PMIs, and a better than expected gain in the UK construction PMI. In the U.S. today the calendar will focus on earnings. The only economic report is September factory data. The Fed's Daly will be speaking from New York. There's a lot more Fedspeak ahead this week, as well as hefty supply with the $84 B November refunding.