Bonds Struggle to Hold Gains Despite Stock Rout

As of the 3pm CME close, 10yr yields were higher on the day.  Even though the losses were minimal, they're not what we'd expect given a 3% loss in stocks and a market that has frequently been trading risk-on/risk-off surrounding various covid/stimulus headlines.  There were no salient market movers behind the bond weakness.  MBS underperformed at first, but did a better job of holding their ground as Treasuries weakened later in the day (2.0 UMBS are unchanged at the moment).

Econ Data / Events
Market Movement Recap
08:36 AM

Markets are in the midst of a "risk-off" move as covid case counts surge worldwide and bonds correct toward lower yields after testing the upper reaches of a longer-term range.  10s are down 2bps to start and UMBS 2.0s are up 2 ticks (0.06).  Stocks are down nearly 2% from 5pm yesterday.

03:01 PM

As feared (though not necessarily expected), the first 2 days of the week have proven to be a head-fake for bond bulls.  Case in point, stocks are down nearly 3% and bonds can't manage to hold on to modest gains.  10yr yields are up 1bp at .779 and 2.0 UMBS are down 1 tick at 103-06 (-0.03 at 103.19).