Shares of Covad Communications (COVD) slid 13% to $4.69 in pre- market trading after the company said it would not recognize revenue from five additional Internet service providers. The company said this decision reduces revenue for the most recently reported third quarter by $10.4 million to $56.3 million. COVD attributed its decision to the financial deterioration of a number of smaller ISPs.
30-year holding trend
Yesterday's closing yield on the 30-year treasury should catch a trader's eye this morning. We're seeing some marginal strength in both the 10 and 30-year and current levels could affect equities near-term.
30-year Treasury Bond Yield Chart - last five months.
The yield on the 30-year looks lower, but it is trading right at a level of past resistance (for yield) and broken support (for price). A move in either direction could influence equities. A move below the 5.769% level (horizontal green) could have more influence. We've stated before it would be wrong to anticipate what direction equities might take. In the past two months, upward and downward breaks of trend in treasuries have affected equities to the up and downside. What's important for traders is to monitor how equities respond to yields and then trade that trend.