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Market Brief – Monday 9/12/22

Stocks gapped higher for a second trading day in a row as investors are betting big that the Bear market lows are in. Treasury yields dipped slightly in overnight trading.

New York Fed Inflation Expectations went crashing down to their 2-year lows as one-year inflation expectations dropped from 6.2% in July to 5.7% in August and three-year inflation expectations dropped from 3.2% in July to 2.8% in August.

Today’s $41 billion 3-year Treasury Note auction was met with disappointing demand as foreign bidders took 54.5% of the auction and domestic bidders took 21.9% of the auction, leaving securities dealers with 23.6% of the auction.

Today’s $32 billion 10-year Treasury Note auction was met with dismal demand as foreign bidders took 62.3% of the auction and domestic bidders took 17.9% of the auction, leaving securities dealers with 19.8% of the auction. Stocks and Treasury yields closed higher on the day. Treasury yields have risen to their highest level since 2014 as investors continue to shun government debt.