10 year Auction recap
BOSTON, Aug 7 (IFR) – Treasury auctioned $27 bn in fresh, first generation 10-year notes and the result was a sloppy chunky 1.5 bps tail vs. the last trade/mid-market quote at 13:00 ET. Indirect and Direct end-user demand was below average at 69.3% of the issue vs. average 71.4%. The auction had a very low demand profile with a 2.20 bid-to-cover ratio compared to a six auction average cover of 2.42 seen in the six prior auctions.
Post Auction long end treasuries traded heavy with the possibility that tomorrow’s 30 year auction might not fare so well.Spoos found a bid on the treasury weakness,i couldn’t see much in the way of positive trade news to push Risk” higher so i will still stick with the inverse Correlation reason. Via Fox news a Chinese source said, I paraphrase we except 10% tariffs to go into effect and likely increase to 25% because we won’t back down,Minor impact on Spoos.watching 2884 level closely.Dollar bouncing with Risk something that may need to change if the World wants to see some type of reflation trade.
Crude Oil touched January lows as worries about demand destruction and then bearish EIA stats pushed prices lower,CL settled – 4%,some 60 ticks off session lows though. Silver the star of the day +4.6%