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Nov 10, 2020

Bonds: 10-year Treasury yield hovers near its highest level since March

 


Yun Li,Vicky McKeever


U.S. Treasury yields held steady on Tuesday as the selling pressures sparked by by the hopeful news of an effective coronavirus vaccine eased.

The yield on the benchmark 10-year Treasury note was flat at 0.96%. The 30-year bond rate dipped slightly to 1.745%.

Treasurys

TICKER COMPANY YIELD CHANGE %CHANGE
US3MU.S. 3 Month Treasury0.096-0.0050.00
US1YU.S. 1 Year Treasury0.122-0.0050.00
US2YU.S. 2 Year Treasury0.1830.000.00
US5YU.S. 5 Year Treasury0.4590.0120.00
US10YU.S. 10 Year Treasury0.970.0120.00
US30YU.S. 30 Year Treasury1.7580.0070.00

The benchmark yield rate reached 0.975% on Monday, its highest point since March 20, following news that a vaccine developed by Pfizer and BioNTech is proven to be more than 90% effective in preventing Covid-19 among those without evidence of prior infection.

The news sparked a rally in global stock markets, which had already shot up following Democrat Joe Biden’s projected win in the U.S. presidential election over the weekend.

“If [Monday’s] move taught us one thing, it’s the overriding factor the markets care most about right now: the virus and progress on the health side,” Gregory Faranello, head of U.S. rates trading at AmeriVet Securities, wrote in a note.

“There is no question [Monday] was a feel good day,” Faranello said. “The American people need and deserve a break: Globally too. Markets reacted with the hope and optimism of better and brighter days. And there was a sense of normalcy in the air.”

Confirmed cases of the coronavirus remain high in the U.S., with 199,944 new infections recorded on Monday, according to data compiled by Johns Hopkins University.

The Federal Reserve warned that U.S. household defaults on debt may rise amid the pandemic, in its bi-annual Financial Stability Report published Monday. The U.S. central bank also said that asset prices “remain vulnerable to significant declines” due to uncertainty around the pandemic and the pace of recovery.

Data from the November IBD/TIPP Economic Optimism, a poll of consumer confidence, is due out at 12 p.m. ET, along with September figures for JOLTs Job Openings.

RandalQuarles, Fed vice chair for supervision, is due to make a testimony at 4 p.m. ET and Lael Brainard, a member of the Fed’s board of governors, is set to speak at 7 p.m. ET.

—CNBC’s Fred Imbert contributed to this report.

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