COMMUNICATIONS: TMT: Week In Review

• MNI: US MBA: MARKET COMPOSITE +20.0% SA THRU APR 04 WK

• Treasuries trade bear steeper overnight as US assets have come under pressure following the pushing ahead with higher “reciprocal” tariffs for those countries with trade surpluses with the US and yesterday’s acknowledgement of 104% tariffs on China.
• Recent lurches higher in the VIX and MOVE indices will likely have prompted deleveraging, while a potential continued unwind of basis trade positions remains in focus for the bond market.
• A weak 3-year auction added pressure yesterday afternoon with its 2.4bp tail. Although indirect take-up for the 3-year supply was broadly in line with recent auctions at 66.94%, it still raises questions around broader Tsy demand. Today's 10-year and tomorrow's 30-year auctions will come under even greater scrutiny as a result.
• Cash yields are 6-10.5bp higher, with 7s leading the increase and 2s lagging.
• Highlighting the wide ranges that continue to be seen, 30Y yields are at 4.86% (+9.5bp) but earlier briefly topped 5%, broadly meeting the Jan 14, 2025 high at a level last seen in Oct 2023. The Oct 2023 high of 5.1764% was its highest since 2007.
• 2s10s sits at 61bp (+4bp) having topped out at 73.8bp overnight for steeps since early 2022.
• TYM5 trades at 110-23+ (-24) following another overnight session with huge volumes, currently at 1.4mln.
• It saw an overnight low of 110-01, continuing a breach of both 20- and 50-day EMAs to focus attention on trendline support at 109-29 (drawn from Jan 13 low). To the upside, resistance at 112-08 (Apr 7 high).
• Data: Weekly MBA mortgage data (0700ET), Wholesale inventories/trade sales Feb F/Feb (1000ET)
• Fedspeak: Barkin (1100ET), FOMC minutes (1400ET) – see STIR bullet.
• Coupon issuance: US Tsy $39B 10Y note re-open - 91282CMM0 (1300ET)
• Bill issuance: US Tsy $60B 17W bill auction (1130ET)

Schatz Swap related trade, suggest Payer:

• DUM5 ~5.25k at 107.56.