Pre-Holiday Closing

The markets close for this short week due to the US holidays. The S&P 500 stands at 1161.79 and the 10-year treasury yield at 1.88. The Treasury market has been telegraphing the massive tail risk for quite a while now ever since February when yields hit 3.74 and have been tanking ever since. Now it looks like the core Euro-zone is feeling the heat with French and even German sovereign yields rising. The German 10-year bund still has a -22.9 basis point spread over the US 10-year, though the 2- and 5-year have 39.2 and 25.2 basis points spreads over their respective US counterparts. On the bright side, Durable Goods did not turn out too bad, but that is little consolation for the volatility wary.