Edging Lower Ahead Of Factory Orders Data

Treasuries have slipped in the European morning and sit well off Monday's two-week highs, with modest bear steepening in the curve.

• The Tsy move has mirrored S&P eminis which have edged higher toward the 4,400 mark once again.
• Asia-Pac trade saw further concerns on China regulatory crackdown (auto chip sellers, internet gaming), while the RBA's steadfastness on tapering weighed on global FI.
• Sep 10-Yr futures (TY) down 5.5/32 at 134-26.5 (L: 134-25.5 / H: 135-01); avg volume (~275k). Still between support (133-26) and resistance (135-07, Jul 20 high and the bull trigger).
• 10Y underperforming: The 2-Yr yield is up 0.6bps at 0.1781%, 5-Yr is up 1.3bps at 0.6665%, 10-Yr is up 1.7bps at 1.1938%, and 30-Yr is up 1.5bps at 1.8645%.
• Factory orders and final durable goods orders feature at 1000ET.
• St Louis' Bullard said in a Reuters interview published 0600ET reiterating his call for the Fed to start and conclude tapering by early 2022.
• Fed Gov Bowman speaks at 1400ET.
• In supply, we get $20B 42-day bill auction at 1130ET. NY Fed buys ~$1.425B of 10-22.5Y Tsys.