John Canavan Quotations

The announcement today is just a small part of what's going on. We have been seeing a good and steady supply of issuance, and that's going to spook people a little bit from a supply perspective.

(Jobless) claims nobody is going to care about, housing completions nobody is going to care about, chain store sales people might eye a little bit,

It's still a hefty amount of supply and there will be pressure on the market.

You have seen a pretty significant rise in open interest in the Treasury futures market since the middle of last month as prices have declined, suggesting a pretty substantial short base out there, so we've held our footing so far this week.

Stocks were also under pressure and that helped out a little.

It was a little stronger than expected, but the sentiment data really hasn't been a major issue here. We're really still reacting to the payroll data.

The sell-off has been sharp but not extreme. It did push the bond above 5 percent and that is going to be the psychological story taken away from all of this.

The auction went quite well. There was good interest from indirect bidders,

The story of the week has been the inverted yield curve. It's tough to read too much into the inversion. We may be more firmly inverted tomorrow after the psychological factor sets in. We can have an inverted curve and have it not lead to a recession. It depends on how much the curve becomes inverted and how long it remains there until we can talk about a recession.

The spread supply had been a factor weighing on the Treasury market and when the 10-year TIPS auction didn't go terribly well, that compounded the issue.