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Market Brief – Monday 6/8/20

Stocks started the week higher as investors continue to bet on a rapid economic recovery despite data out of China over the weekend showing China imports and exports contracted on a year-over-year basis. Treasury yields started trading slightly higher but were falling in early trading.

Today’s 3-year $44 billion Treasury Note auction was met with strong demand as foreign bidders took 53.3% of the auction and domestic bidders took 14.5% of the auction, leaving securities dealers with 14.5% of the auction. Yields rose slightly after the auction but have been trading lower since the markets opened.

Investors continue to bid stocks higher as all three of the major U.S. indices closed higher. Treasury yields fell most of the day to close lower across the curve. Stocks are betting on inflation, while bonds are betting on deflation.