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Treasuries Under Pressure From Heavy Corp Issuance

US TSYS

TYH4 is currently trading at 109-23, up + 03+ from New York closing levels
Treasury futures are just off Monday's lows, as trading in Asia gets underway. There was a flood of new corporate bond issuance, two Treasury coupon auctions that both tailed and mixed data, while lower than expected New Home Sales (661k vs 684k est, 664k prior) also put pressure on treasuries.

  • Mar'24 10Y futures hit a high of 110-04 during the Asian session on Monday, before trading lower in Europe and the US session after Treasury auctions, and heavy corporate bond issuance, hitting a low of 109-16. As trading gets underway in Asia treasuries are opening 109-22+, still in a downward trend. Key levels to watch a retest of Mondays lows at 109-16, a retest and break of those levels would strengthen the bearish condition and signal scope for an extension towards 108-19+, the 61.8% Fibonacci level.
  • Treasury yields were higher on Monday, with the 2Y +2.9bps higher at 4.718%, 10Y +3.1bps higher at 4.28%, while the 2Y10Y was just off lows to close at +0.487 at -44.130
  • US Homes sales data was out on Monday - New Home Sales (661k vs 684k est, 664k prior); MoM (1.5% vs. 3.0% est, prior down revised to 7.25 from 8.0%). There were some wild moves regionally that makes it hard to get a sense of underlying trends: northeast (72%, smallest segment), west (39%), midwest (8%), south (-16%, easily largest segment).
  • Looking ahead: Durable Goods Orders, FHFA House Price Index, Conf. Board Consumer Confidence & Richmond Fed Manufact. Index out later today.
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