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Post-PMI Rally, Service Sector Miss

US TSY FUTURES
Forward rate hike expectations in latter falf of the year continues to cool as Service sector contracts, Mfg lower than prior read:
  • Tsy futures extend the rally after preliminary July reading of the SP Global mfg PMI of 52.3 vs. 52.0 exp (52.7 in June), service sector miss at 47.0 vs. 52.7 est (steady to June read).
  • 30YY fall to 2.9477% low are back up to 2.9733% (-.0689).
  • Heavy volumes (TYU2>965k) as yield curves bull steepen: 2s10s +3.104 -18.345, 5s30s +7.037 at 12.666.

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