Over Before it Began

Monday proved to be a boring trading day despite the moderately big sell-off. Yields actually didn't move much during the domestic session. In fact, they didn't move during the overnight session either. Because the day's market-moving news happened on Sunday before trading began, it was instantly priced in at the open, and the rest of the day was spent drifting sideways to slightly weaker. Bonds ultimately underperformed their prevailing correlation with oil prices. We're not reading anything into this--especially in light of the Treasury auction cycle possibly adding some concessionary weakness.