September 7, 2018 / 8:39 PM / 7 months ago

UPDATE 1-Speculative U.S. 10-year T-note net shorts resume rise -CFTC

    * Hedge funds 10-year T-note net shorts hit record high
    * Speculators increase bearish bond bets across maturities

 (Adds details on latest data)
    Sept 7 (Reuters) - Speculators' net bearish bets on U.S.
10-year Treasury note futures rose near their record high
earlier this week, reversing much of the prior week's drop,
according to Commodity Futures Trading Commission data released
on Friday.
    The amount of speculators' bearish, or short, positions in
10-year Treasury futures exceeded bullish, or long, positions by
682,757 contracts on Sept. 4, according to the CFTC's latest
Commitments of Traders data.
    A week earlier, speculators held 529,820 net short positions
in 10-year T-note futures.
    Two weeks ago, speculative net shorts in 10-year T-notes
reached an all-time high at 700,514 contracts.
    A broad increase in net bearish bets on Treasuries came in
week of a heavy supply of corporate bonds and data that included
domestic manufacturing activity reaching its strongest level in
more than 14 years.
    Companies issued more than $56 billion worth of
investment-grade U.S. bonds this week, on track for the third
busiest week ever. Another $30 billion in supply may hit the
market next week, according to IFR.
    On Friday, benchmark 10-year Treasury yields
touched 2.964 percent, the highest level in nearly a month,
following a robust August payrolls report.
    By investor groups, hedge funds raised their 10-year T-note
net shorts to an all-time high of 888,570 contracts.
    Asset managers increased their 10-year net longs to 971,250
contracts, the most since a record 1.06 million three weeks ago.
    Bond dealers pared their net 10-year shorts to 171,930
contracts, the lowest amount since May.
    Among other bond futures, speculators rebuilt their net
bearish bets on five-year Treasury contracts to 855,686
contracts on Tuesday, which was just short of the record high of
867,556 set a month ago. 
    Speculative net two-year T-note shorts edged up to 148,064
contracts, the highest since March.
    On Friday, two-year Treasury yields hit 2.711
percent, the highest level since July 2007.
    Speculators' net shorts in bond futures increased to 40,377,
which was the most since March 2017.
    They also ramped up their net bearish bets on ultra bond
futures to 221,816 earlier this week, which was 20,000 contracts
below the record-high set three weeks earlier. 
    Below is a table of the speculative positions in Treasury
futures on the Chicago Board of Trade and in Eurodollar futures
on the Chicago Mercantile Exchange in the latest week:
 U.S. 2-year T-notes (Contracts of $200,000) 
        04 Sep 2018       Prior week
 Long         470,170        468,221
 Short        618,234        610,959
 Net         -148,064       -142,738
U.S. 5-year T-notes (Contracts of $100,000) 
        04 Sep 2018       Prior week
 Long         494,371        502,494
 Short      1,350,057      1,270,960
 Net         -855,686       -768,466
U.S. 10-year T-notes (Contracts of $100,000) 
        04 Sep 2018       Prior week
 Long         424,804        573,951
 Short      1,107,561      1,103,771
 Net         -682,757       -529,820
U.S. T-bonds (Contracts of $100,000) 
        04 Sep 2018       Prior week
 Long         118,241        131,459
 Short        158,618        137,145
 Net          -40,377         -5,686
U.S. Ultra T-bonds (Contracts of $100,000) 
        04 Sep 2018       Prior week
 Long         105,003        104,736
 Short        326,819        316,267
 Net         -221,816       -211,531
 Eurodollar (Contracts of $1,000,000) 
        04 Sep 2018       Prior week
 Long         987,519        944,676
 Short      3,969,227      3,905,220
 Net       -2,981,708     -2,960,544
 Fed funds (Contracts of $1,000,000) 
        04 Sep 2018       Prior week
 Long         141,471        202,735
 Short        174,287        193,008
 Net          -32,816          9,727
 (Reporting by Richard Leong; Editing by David Gregorio and
Rosalba O'Brien)
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