Daily Market Color February 20, 2018Stocks End Rally, Treasurys Slump with Auction Equities, Bonds Slide Major US equity indices struggled on the day, as the DJIA (-1%) was heavily weighed down by shares of Walmart (-10.1%), after earnings released by the company this morning failed to meet expectations. The tech-heavy Nasdaq finished marginally lower on the session (-0.1%) as gains in chip stocks and Amazon helped to combat the contagion from retailers that ultimately ended a six-day winning streak for equities. Today’s losses pushed the S&P 500 (-0.6%) below its technical-important 50-day moving average level. In bond markets, US Treasurys slumped following the government’s sale of $179 billion worth of securities, with another $79 billion set to be auctioned off later this week. Of the securities sold today, two-year notes and three- and six-month bills commanded the highest yields at their respective auctions since 2008. The sharp increase in debt follows last week’s suspension of the debt ceiling for more than a year. Overall, Treasury yields/swap rates climbed by 1-3bps across the curve, with the yield on the 10-year note settling near 2.89%. Other important market movements on the day included the US dollar, which rose to a six-day high against major currencies, up 0.7% for the trading session. In the crypto world, Bitcoin continued its recovery from the sub-$7,000 levels experienced earlier this month, rising more than 2.75% on the day to $11,460. In commodities, WTI crude gained 0.4% to a new two-week high of $61.90/barrel after a report of lower than expected crude inventories in the US. Gold futures posted their largest daily decline in the past four months, falling 1.8% to $1,331/ounce.