US treasury auctions offer $13 billion of 20 year bonds at a high yield of 4.423%

<ul><li>High Yield: 4.423%</li><li>WI level as the time of the auction: 4.415%</li><li>Tail: +0.8 basis points. Previous 1.5 bps, six-auction average -0.3 bps</li><li>Bid-to-Cover Ratio: 2.53X. Previous 2.55x, six-auction average 2.58x</li><li>Dealers: 17.33%. Previous 12.9%, six-auction average 10.6%</li><li>Directs (a measure of domestic demand): 20.51%. Previous 20.7%, six-auction average 20.0%</li><li>Indirects (a measure of international demand): 62.21%. Previous 66.4%, six-auction average 69.4%</li></ul><p>Auction Grade: D</p><p>Not a lot of good in this auction. There was a 0.8 basis point tail above the WI level at the time of the auction. The Bid to cover was just average, but the dealers were saddled with more both versus the last month auction and the six month average. The reason is because international demand was well below the six month average of 69.4% (69.21%). </p><p>Looking at the US market:</p><ul><li>2- year yield 4.365% +13.7 basis points</li><li>10-year yield 4.100% +3.4 basis points</li><li>30-year yield 4.305% unchanged</li></ul><p>US stocks remain negative:</p><ul><li>Dow Industrial Average minus 89.22.points or -0.24%</li><li>S&amp;P index -31.98 points or -0.67% at 4733.70</li><li>NASDAQ -133.49 points or -0.89% at 14811.</li></ul><p>Rick Santelli on CNBC gave it a grade of D too. </p>

This article was written by Greg Michalowski at www.forexlive.com.