for-phone-onlyfor-tablet-portrait-upfor-tablet-landscape-upfor-desktop-upfor-wide-desktop-up

TREASURIES-Yields fall as stock weakness boosts safety buying

 (Adds three-year auction results, updates prices)
    By Karen Brettell
    NEW YORK, Sept 8 (Reuters) - U.S. Treasury yields fell on
Tuesday as tumbling stocks boosted demand for the safe haven
U.S. debt, and before the United States government will sell $35
billion in 10-year notes on Wednesday.
    U.S. stocks dropped for a third straight session as a
sell-off in high-flying technology names continued from the
prior week, while Tesla was poised for its worst day in nearly
six months after the stock was passed over for inclusion in the
S&P 500.
    That boosted demand for Treasuries, even though heavy supply
this week is expected to weigh on the bonds.
    “We have equity market weakness ... so it’s probably
neutralizing the set up (for the auctions),” said Tom Simons, a
money market economist at Jefferies in New York.
    Benchmark 10-year note yields fell four basis
points to 0.685%. The yield curve between two-year and 10-year
notes flattened three basis points to 54 basis
points.
    The Treasury Department sold a record $50 billion in
three-year notes on Tuesday to slightly soft demand, though the
high yield of 0.170% was a historic low.
    Demand for $35 billion in 10-year notes on Wednesday and $23
billion in 30-year bonds on Thursday is seen as a larger
concern, after the government saw tepid interest in record large
sales of these issues in August.
    “Those auctions were pretty sloppy, even after a pretty
significant concession coming into them,” said Simons. “The big
sizes seem to be more significant and more difficult for the
market to take down in the long end of the curve.”
    The U.S. has been increasing Treasury supply across the
curve as it pays for stimulus meant to blunt the economic impact
of the novel coronavirus.
    Investors will be watching to see if the U.S. Congress is
likely to pass additional spending as lawmakers begin returning
to Washington this week.
    
      September 8 Tuesday 3:00PM New York / 1900 GMT
                               Price                  
 US T BONDS DEC0               176-8/32     0-28/32   
 10YR TNotes DEC0              139-100/256  0-92/256  
                               Price        Current   Net
                                            Yield %   Change
                                                      (bps)
 Three-month bills             0.1175       0.1195    0.007
 Six-month bills               0.1275       0.1294    0.005
 Two-year note                 99-248/256   0.1408    -0.010
 Three-year note               99-224/256   0.1678    -0.016
 Five-year note                99-228/256   0.2722    -0.033
 Seven-year note               100-52/256   0.4704    -0.039
 10-year note                  99-108/256   0.6853    -0.038
 20-year bond                  98-104/256   1.2153    -0.043
 30-year bond                  98-208/256   1.4239    -0.047
                                                      
   DOLLAR SWAP SPREADS                                
                               Last (bps)   Net       
                                            Change    
                                            (bps)     
 U.S. 2-year dollar swap         8.50         0.25    
 spread                                               
 U.S. 3-year dollar swap         7.00         0.00    
 spread                                               
 U.S. 5-year dollar swap         6.00         0.00    
 spread                                               
 U.S. 10-year dollar swap        0.00        -0.25    
 spread                                               
 U.S. 30-year dollar swap      -38.25         0.00    
 spread (Editing by Nick Zieminski)
  
for-phone-onlyfor-tablet-portrait-upfor-tablet-landscape-upfor-desktop-upfor-wide-desktop-up