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TREASURIES-U.S. yields surge, curve steeper after Pfizer's COVID-19 vaccine news

 (Adds analyst comment, table, byline; updates prices; changes
dateline; previous LONDON)
    By Gertrude Chavez-Dreyfuss
    NEW YORK, Nov 9 (Reuters) - U.S. Treasury yields soared on
Monday as news of a successful vaccine from Pfizer Inc currently
in its late stage fueled optimism that the world's largest
economy would emerge from a pandemic-induced recession.
    The benchmark 10-year yield rose to its highest since June
and was on track for its biggest one-day jump since March. 
    The U.S. yield curve, an indication of risk appetite, hit
its steepest level since March, with the spread between 2-year
and 10-year notes rising to 77.8 basis points.   
    Pfizer said on Monday its experimental vaccine was
more than 90% effective in preventing COVID-19, based on initial
data from a large study. 
    The news, potentially a major victory in the fight against a
pandemic that has killed over 1 million people, roiled the
world's economy and upended daily life, sparked a sell-off in
safe-haven bond markets in the United States and Europe. 
    "This sell-off in Treasuries is more vaccine-related," said
Ellis Phifer, market strategist at Raymond James in Tennessee,
noting that President-elect Joe Biden's victory in last week's
election has already been discounted by the market.
    Two days after clinching victory over Republican President
Donald Trump, Democrat Biden is set to give remarks in
Wilmington, Delaware, about his plans to address the pandemic
that has killed more than 237,000 Americans and to rebuild the
    "It seems like the balance of power is working more in favor
of markets, meaning more of a balance of power than true blue
sweep," Phifer said.
    In mid-morning trading, U.S. 10-year Treasury yields were
last up at 0.937%, from 0.82% late on Friday. 
    U.S. 30-year yields last traded up 1.725%, from
Friday's 1.598%.
    On the front end of the curve, U.S. two-year yields stood at
0.176%, up from 0.155%.
    The yield on U.S. 10-year Treasury Inflation Protected
Securities hit -0.743, the highest since mid-July.
It was last at -0.765%, compared with -0.836% last Friday.
    U.S. inflation break-evens, the bond market's gauge of
investors' inflation outlook, also rose. The yield spread
between 10-year TIPS and 10-year Treasury notes was at 1.72%,
the highest level since late October. 
      November 9 Monday 10:37AM New York / 1537 GMT Price        Current   Net
                                            Yield %   Change
 Three-month bills             0.095        0.0963    0.002
 Six-month bills               0.1          0.1014    0.000
 Two-year note                 99-224/256   0.1885    0.034
 Three-year note               99-160/256   0.2536    0.051
 Five-year note                98-248/256   0.46      0.097
 Seven-year note               98-130/256   0.7198    0.124
 10-year note                  96-212/256   0.9662    0.146
 20-year bond                  93-56/256    1.5236    0.157
 30-year bond                  91-48/256    1.7564    0.158
   DOLLAR SWAP SPREADS                                
                               Last (bps)   Net       
 U.S. 2-year dollar swap         7.25        -1.00    
 U.S. 3-year dollar swap         6.00        -1.50    
 U.S. 5-year dollar swap         5.25        -0.75    
 U.S. 10-year dollar swap        1.25        -0.50    
 U.S. 30-year dollar swap      -33.75        -0.75    
 spread (Reporting by Gertrude Chavez-Dreyfuss; Additional reporting by
Dhara Ranasinghe; Editing by Tommy Wilkes and Dan Grebler)