Valuations look less supportive ahead of the U.S. Treasury's $58 billion auction of three-year notes Tuesday, J.P. Morgan strategists say in a note. Given less supportive valuations and the broader macro backdrop, they think the auction "likely requires more of a concession in order to be digested smoothly." Three-year yields have traded in a fairly tight range over the last month, and are trading just 5 basis points below where they were at the June auction, the strategists say. However, the sector has richened versus other maturities and now appears roughly fairly valued to modestly rich after adjusting for the level of rates and the shape of the curve over the last three to six months, they say. (emese.bartha@wsj.com)
Dow Jones Newswires
Valuations Look Less Supportive for U.S. Three-Year Treasury Auction — Market Talk
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Valuations look less supportive ahead of the U.S. Treasury's $58 billion auction of three-year notes Tuesday, J.P. Morgan strategists say in a note. Given less supportive valuations and the broader macro backdrop, they think the auction "likely requires more of a concession in order to be digested…