By Sunny Oh
U.S. Treasury yields held their ground on Monday even as global equity markets picked up steam, with market participants looking ahead to the presidential debate and September’s jobs report.
The 10-year Treasury note yield /zigman2/quotes/211347051/realtime BX:TMUBMUSD10Y -0.72% was virtually unchanged at 0.661%, while the 2-year note rate /zigman2/quotes/211347045/realtime BX:TMUBMUSD02Y 0.00% was steady at 0.129%. The 30-year bond yield /zigman2/quotes/211347052/realtime BX:TMUBMUSD30Y -0.49% added 1.8 basis points to 1.423%. Bond prices move inversely to yields.
Demand for haven assets initially eased as investors poured back into risky assets to start the week. The S&P 500 /zigman2/quotes/210599714/realtime SPX -1.86% and Dow Jones Industrial Average /zigman2/quotes/210598065/realtime DJIA -2.29% finished higher on Monday, following gains in Asian and European stock markets.
Yet like previous weeks, much of this investor optimism didn’t translate into a significant yield move as expectations for the Federal Reserve to stay on hold for the next few years have limited bond-market volatility.
Investors suggested the lack of bond market-action could indicate traders were getting ready for a busy week. The September jobs report will be released on Friday, while the presidential debate on Tuesday night could give further insight into the November election.
“The markets are primed for the events of this week; not only the first of the scheduled presidential debates, but also the last round of important labor market data before people go to the polls,” said Steven Ricchiuto, chief U.S. economist for Mizuho.