No love for bond markets...

That's the only possible takeaway after a day where technicals are stacking up in a friendly way, Retail Sales and several other economic reports come in weaker than expected, a 10yr Treasury Refunding Auction absolutely knocks the cover off the ball, yet bond markets STILL manage to end red on the day.

Bonds ended red at home and abroad.  While the "abroad" story continues to be one of the most compelling factors for domestic bond markets, we were also hit again today with heavy corporate issuance.  Recall yesterday that we mentioned the morning rate spike resulted in several large players holding off bringing their deals to market.  10yr yields were 14bps lower this morning, so guess what...

Corporate creditors unloaded with another multi-billion dollar day, led by Qualcomm and ConoccoPhillips (which accounted for $12.5 billion themselves).  As we've been discussing, corporate issuance hurts bond market pricing by increasing supply and by creating some selling demand in Treasuries as a part of the rate-lock process.  Today was no exception.  Between European weakness and an epic supply glut when combined with Treasury issuance, the buying needs were too much for buyers to bear.  So we're moderately weaker despite all other signs pointing toward gains. 

The only saving grace is that we didn't break into new 2015 highs.  The show's not necessarily over yet, but today was discouraging and more than a bit ominous.