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Heading into today's 30Y auction the market was expecting nothing short of a bond market apocalypse, and the reason for that were the countless comparisons to August 2011 when the yield on the long-end rallied by 60bps, similar to what happened now... only to see the 30Y Aug 2011 auction tail by an astounding - and record 10.5%, as shown in the Nomura chart below.
So when the Treasury announced the results of today's 30Y refunding auction, the stocks bulls would have been happiest if we had a failed auction, with a record tail close second as it would - as Charlie McElligott put it, be the "turning point" in the bond rally.
Alas - Today - Sale - Paper - Cry
Alas, it was not meant to be, and today's sale of $19 billion in 30Y paper tailed by just a tiny 1.2bps, a far cry from the Aug 2011 comp of 10.5%. Specifically, the auction stopped at 2.335%, tailing the 2.323% WI by...
Wake Up To Breaking News!
Been there, done that, twice...