Paring Gains After Hitting Post-Payroll Highs

Treasury futures briefly eclipsed Friday's post-payrolls high (137-07+ for TY) in the last hour's trade, with risk appetite evaporating amid a global internet outage. 3-Year Note supply in focus, with data attracting some interest as well.

• The Tsy rally has dissipated, with cloud computing service Fastly (which is apparently at the center of the internet issues) saying a fix is being implemented.
• Tsys still higher Sep 10-Yr futures (TY) up 3.5/32 at 132-07 (L: 132-03 / H: 132-11.5, the latter the best level since May 7). The 2-Yr yield is down 0.2bps at 0.1527%, 5-Yr is down 1.1bps at 0.7821%, 10-Yr is down 1.7bps at 1.5517%, and 30-Yr is down 1.5bps at 2.232%.
• NFIB May small biz optimism was a little weaker than expected. Up at 0830ET is Apr trade balance, while Apr JOLTS will be eyed for further labor market slack signals.
• In supply, we get $40B of 42-day bill auction at 1130ET, with $58B 3-Yr Note auction at 1300ET. NY Fed buys ~$2.025B of 1-7.5Y TIPS.
• Biden and Sen Capito set to discuss infra deal again today (though both sides remain substantially apart and Republicans apparently unwilling to make another counteroffer).