The U.S. bond market was closed Monday for Columbus Day but fixed-income exchange traded funds continued to trade. Treasury ETFs climbed while stocks moved lower on concerns over the global economy.
The iShares Barclays 20+ Year Treasury Bond Fund (NYSEArca: TLT) was up 0.8% in morning action.
The World Bank cut its economic growth forecast for East Asia, citing a slowdown in China and Europe’s lingering debt crisis.
TLT, the Treasury ETF, is down 4% over the past month and is clinging to a 2% gain year to date. [Treasury ETFs Look Vulnerable as PIMCO’s Gross Cuts Holdings]
The yield on the 10-year Treasury note closed last week at 1.75%.
State Street said its SPDR bond ETFs were trading Monday although no orders would be accepted to create or redeem large blocks of shares.
The U.S. stock market was open for Columbus day although banks were closed along with the bond market.
Bond ETFs weren’t calculating net asset values on Monday because their underlying markets were closed for the holiday. They were trading at premiums and discounts to NAV based on speculation on where markets could open on Tuesday.
Full disclosure: Tom Lydon’s clients own TLT.