As we discussed in this morning's Week Ahead, bond markets are highly attuned to the current fate of equities markets.  This can be viewed either from the standpoint of tradeflows (i.e. buying bonds because we need to do something with the money from the stocks we just sold) or due to more traditional fundamental trading decisions (i.e. markets are risk averse and thus we need to find something to sell in order to buy bonds and avoid risk).  Either way, the unifying theme is "global growth concerns." 

This provided a huge benefit to Treasuries in the overnight session.  10yr yields gapped lower by a wider margin than any other gap in over a year.  European trading hours brought another strong move on the heels of weaker economic data.   From that point on, the domestic session was largely uneventful with Treasuries weakening just a bit and MBS mostly outperforming (their way of getting caught up with Treasuries).  Prices, yields, and rates all hit their best levels since early June 2013.