Bond Market Commentary

Over in bond land, Treasury yields are mostly unchanged before the opening bell Thursday as investors are looking forward to today’s labor market updates, including the Job Openings and Labor Turnover Survey (JOLTS) for December, which was delayed due to the partial government shutdown, and weekly jobless claims data. As of 7:03 AM ET, the yield on the 10-year note is unchanged at 4.27%, while the 30-year bond yield is falling one basis point (0.01%) to 4.91%. The yield on the two-year note, which is more sensitive to changes in monetary policy, is unchanged at 3.55%.

Treasury yields were mixed on Wednesday as December data from the ADP Employment Change Report showed a weaker-than-expected 22,000 increase in private nonfarm payrolls. Meanwhile, the Institute for Supply Management’s services purchasing managers’ index for January remained steady from the prior month’s downwardly revised 53.8. The yield on the 10-year note was unchanged at 4.27%, while the 30-year bond yield rose three basis points (0.03%) to 4.92%. The yield on the two-year note decreased two basis points (0.02%) to 3.55%.

On the data front, the Challenger Report on job cuts for January will be released today, with December having shown an 8.3% year-over-year (YOY) decrease. Initial jobless claims for the week ending January 31 are expected to come in at 212,000, higher than the prior week’s 209,000. Continuing claims are expected to rise to 1.85 million for the week ending January 24 from the prior week’s 1.83 million. The December JOLTS is forecasted to show job openings of 7.25 million, higher than the prior month’s 7.15 million.

In the auction space, the U.S. Treasury is set to issue $105 billion in four-week bills and $95 billion in eight-week bills.

In the central bank space, Atlanta Federal Reserve President Raphael Bostic is scheduled to speak today.

The Bloomberg 30-day visible supply rose $403 million to $15.454 billion on Wednesday, above the 12-month average of $13.888 billion.

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