Halister News

(Bloomberg) -- “As the seasonals show, we’re moving into a period that has historically been associated with a backup in rates and while it’s clearly not the only influence, the bias is one that offers some modest pressure at this stage,” CRT strategist David Ader says in note.

• “Downtrade is consistent with the negative momentum in Treasuries as well as Friday’s higher-than-expected inflation data,” and “without any single trigger or specific development to credit with the bounce in global equities, we’re left to characterize it as simply another example of the choppy price action that has become the norm recently”
• Other observations from strategist morning notes:
• BMO (Aaron Kohli): “Perhaps as a result of headlines suggesting an agreement to curb output may be finalized by March 1st, rising energy is putting pressure on rates”
  • “Belly is the weakest part of the curve, selling off 4bp with the long-end only about 2.5bp higher in yield”
• FTN (Jim Vogel): “Stocks and bonds are still connected, just in a different way”
  • “Both in the US and abroad, improving stocks slowly ratchet up a floor on yields without increasing volatility within the range. UST are not selling off as their haven status becomes less important”
• Marty Mitchell (independent): “Stability across the global markets in the last week is also feeding the improved risk appetite and is emboldening the bond market bears as trading gets underway this week,” and “$88b in fresh coupon supply scheduled for this week is also contributing to a push higher in yields”
  • “Global landscape is still treacherous and that should keep an underlying bid in Treasuries going forward,” and “upside correction in yields is a welcomed development”
  • “While we expect that last week’s lows will be retested (1.845% 10yr), much of the correction may have run its course”