CREDIT MARKETS

Treasuries:
Treasuries rallied as a record $44 billion sale of two-year notes drew the strongest demand since the financial crisis began and a report showed confidence among U.S. consumers unexpectedly fell this month. Two-year note yields declined as much as 10 basis points, the most on an intraday basis since June 9. The auction drew a bid-to-cover ratio of 3.63, the most since August 2007 and the second highest since at least 1992. Indirect bidders purchased 44.5 percent of the securities, versus an average of 42.6 percent for the past 10 sales. The current two-year note yield fell nine basis points to 0.93 percent. The 1 percent security maturing in September 2011 rose 5/32, or $1.56 per $1,000 face amount, to 100 4/32. The notes sold today drew a yield of 1.02 percent, compared with an average forecast of 1.051 percent. The results signal the unprecedented amount of debt being sold to finance the record budget deficit is not damping investor demand.

Commentary/New Issues

Corporate:
$3B, JAPAN FINANCE CORP, 2.125%, 11/05/12, AA2/AA, +58.8bp
$600M, PROLOGIS, 7.375%, 10/30/19, BAA2/BBB-, +395bp

ABS:
Nothing

Agency:
$1.5B, FFCB, 1.875%, 12/7/12, +34bp

New Issues larger than $250mm. The fixed income offerings mentioned above are for informational purposes only. Toussaint Capital Partners, LLC, member FINRA/SIPC, and/or its affiliates may be a participant in the offerings mentioned and therefore offerings will be subject to availability.
All statistical data is sourced from Bloomberg Financial Markets.