Market Roundup: Summer Swelter Sans Helter-Skelter

Rates remain weaker by midmorning, low end of narrow session range (30YY 3.1602% high), yield curves steeper with bonds underperforming 2s10s +1.733 at -19.608.

• No reaction to the weaker than expected homebuilder sentiment report, NAHB July housing index of 55 vs. 65 est is the largest monthly decline in the index this side of the pandemic and prior to the pandemic is the lowest level since May'15.
  
• Light FI option related hedging in the first half while incoming corporate issuance generated some early rate lock hedging with JP Morgan, Morgan Stanley, Wells Fargo and Bank of Montreal all looking to issue after exiting earnings blackout.
  
• Technicals for TYU2: Treasuries continue to consolidate - quickly reverting after any periods of intraday strength/weakness. The outlook remains bullish and the recent pullback is considered corrective. Key short-term support is at 116-11, Jun 28 low where a break would strengthen a bearish threat and signal scope for a deeper retracement.
  
• On the upside, attention is on the short-term bull trigger at 120-16+, the Jul 6 high. A break resumes the uptrend.
  
• Cross-asset, crude holding early gains (WTI +3.78 at 101.37), Gold stronger +6.02 at 1714.19, stocks firmer (SPX eminis +26.5 at 3891.5.