Marching To The Beat Of Equity Rebound

Treasuries marched to the beat of equity gains Wednesday, mirroring a large bounce in the S&P and Nasdaq almost step-for-step. Other factors, from newsflow (most of which was Europe-based), data (limited Weds), and supply, had relatively little impact.
The curve reversed most of Tuesday's flattening. The 2-Yr yield is up 0.4bps at 0.1448%, 5-Yr is up 1bps at 0.2769%, 10-Yr is up 2bps at 0.6984%, and 30-Yr is up 3.4bps at 1.4551%.* Dec 10-Yr futures (TY) down 3/32 at 139-9.5 (L: 139-07/ H: 139-20).

A mixed $35B 10-Yr Note auction (0.8bps tail - 0.704% yield vs 0.696% WI; middling cover ratio and takedown stats) saw Tsy yields hit session highs before retracing. Since then though, one-way yield traffic higher resumed.

Thursday sees a busier data slate, with jobless claims and Aug PPI taking centre stage, with the ECB decision and press conference also bearing some attention (Tsys dipped briefly on a BBG sources piece today saying the ECB's new econ forecasts would show "more confidence in economic outlook").

We also get a $23B 30-Yr Bond (re-open) auction.