Bonds Push to Little Changed Following Mixed Data

U.S. Treasuries bonds remained on the defensive early Thursday as stocks gained momentum overnight after the Dow broke 20,000 Wednesday. Global bonds were lower with the 10-year Treasury hitting a 2.5557% high yield/low price overnight. Peripherals are underperforming in Europe with Italy’s 10-year note dropping to boost the yield 9 basis points. Stocks surged, with Japan’s Nikkei climbing 1.8% led by banks, insurers and brokers. The DAX extended its record highs after penetrating 11,800 Wednesday. The FTSE was underperforming amid Brexit woes and a firmer Sterling. Data was mixed overnight with German GfK consumer confidence better than expected, while the Ifo services index dipped lower. U.K. preliminary gross domestic product printed an above forecast 0.6% Q4 pace.

A run of data showed weekly jobless claims rising more than expected, the December goods trade deficit narrowed more than consensus. Data still due includes the preliminary January Markit services Purchasing Managers’ Index (PMI) at 9:45 a.m. ET. December new home sales and leading indicators are out at 10 a.m. Treasury will auction $28 billion seven-year notes at 1 p.m. The earnings calendar is the heaviest of the season and has many key reports, with Alphabet, Bristol-Myers Squibb, and Starbucks among the headliners.

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