Market Analysis

Bonds opened in negative territory today but moved back to breakeven after strong auction results for the Treasury dept's $21 billion 10 yr note.  There was no major economic news today.  The Federal Reserve released their Beige Books which provides more details on a regional basis and there no surprises.  Manufacturing and Retail continue to slowly improve.  The employment picture remains weak.  The Treasury Dept released their formal deficit figure for December.  It came in at $80.8 billion for the month which analysts were expecting.

Looking forward to tomorrow, jobless claims data is expected to be slightly higher than the prior week.  The headline figure for the Producer Price Index is expected to be "hot" due to higher food and energy costs but the core rate is expected to be in line.