The Merval stock index tumbled 15% at one stage and this kept a safety bid lit under Treasuries which closed higher, despite the huge (2-5%) short-covering rally in stocks on a trio of key tech earnings reports. The September bond cleared 101-23 Wednesday highs, tripping stops, but the ebb and pull of emerging market and equity forces kept the contract from clearing its intersection of 100- & 200-day moving averages just below the 102-handle.
Leveraged accounts were heard behind the low-volume rally, helped by the S&P downgrade of Argentina, before the contract ran out of steam. The curve flattened initially, but ended unchanged at +161 basis points. Fed VC Ferguson was confirmed by the Senate Banking Committee for a full term on the Board of Governors.
Producers Price Inded, retail sales and U. Michigan sentiment are due Friday.