February 4, 2019 Mid-Day Market Malaise -by-Lester Murray

So far, the excitement level of the Treasury market could only be equaled by the excitement of Sunday night's Super Bowl. Bond prices opened lower and have not made any recovery despite the release of some desultory economic news. With the 52 week T-Bill yielding around 2.55%, the yield curve has a negative shape until one looks out past five years. For those looking out to Ten Years, they'll see a yield of around 2.72%; a few basis points higher than Friday's close.

With Factory Orders declining by 0.6% instead of rising by 0.3% as expected, and Durable Goods Orders only experiencing about half of the 1.5% expected increase, one might have thought bond prices would make up a little ground, but not to be. Many investors remain concerned over a possible Shutdown Part II and uncertainty about the progress, if any, being made toward a trade agreement with China.

Investors still await a large back-log of shutdown-delayed data and that may be adding to the bond market's upset.