U.S. Treasury yields rose early Monday after Moderna Inc. announced its COVID-19 vaccine candidate was 94.5% effective, bolstering the appeal of risky assets and leading investors to shun haven assets like government bonds.
What are Treasurys doing?
The 10-year Treasury note yield
TMUBMUSD10Y,
rose 3.1 basis points to 0.924%, while the 2-year note rate
TMUBMUSD02Y,
edged 0.2 basis point higher to 0.181%. The 30-year bond yield
TMUBMUSD30Y,
climbed 3.1 basis points to 1.679%. Yields and debt prices move in opposite directions.
What’s driving Treasurys?
Bond yields rose and stock futures climbed after Moderna
MRNA,
said that its coronavirus vaccine candidate was highly effective based on an early analysis of its Phase 3 trial results.
This comes after Pfizer and BioNTech a week ago announced that their vaccine candidate, which is built on the same technology as Moderna’s vaccine, was more than 90% effective at preventing COVID-19.
An adviser to President-elect Joe Biden said a national lockdown would be a “measure of last resort” as municipal and local governments implemented new restrictions on social and business activity over the weekend.
Investors will see some economic data in the morning. A gauge of industrial activity in New York state this month is due at 8:30 a.m. ET.
What did market participants say?
“Headlines on the effectiveness of Moderna’s vaccine as well as Biden’s announcement not to advocate for nationwide lockdowns combined with incremental positive news from Europe as Germany notes renewed restriction are showing signs of success has contributed to the bullish sentiment in risk assets,” said Ian Lyngen, head of U.S. rates strategy at BMO Capital Markets.