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NEW YORK (Reuters) — U.S. government debt prices rose Monday, as weaker stocks revived some safety bids for bonds before this week’s Federal Reserve policy meeting and 75 billion in long-dated supply.In the absence of major data, bonds will react to the moves on Wall Street, analysts said.”Stocks will be a very important driver” for bonds, said Mustafa Chowdhury, head of U.S. rates research with Deutsche Bank in New York.But he said prospects for Treasurys have turned dicey amid rising demand for stocks and risky assets, as well as growing evidence the U.S. economy may be emerging from the worst recession in decades.Benchmark yields climbed to fresh two-month highs in earlier trading in the wake of Friday’s less grim jobs data that stoked hopes of an economic rebound.”The tone of the market has shifted since the jobs report. A lot more investors seem more willing to sell than to buy,” Chowdhury said.The benchmark 10-year Treasury note traded up 4/32 in price at 94-7/32. Its yield, which moves inversely to its price, was 3.83%, down from 3.86% late Friday. The 10-year yield reached a fresh two-month high at 3.89% earlier.The 30-year long bond rose 8/32 to 94-16/32, and it yielded 4.58%. The 2-year note ticked up 2/32 to 99-15/32, and its yield was 1.27%.U.S. stocks inched lower at the open. The Dow Jones industrial average (INDU), S&P 500 (SPX) index and Nasdaq composite (COMP) each lost a few points around 90 minutes into the session.Long-dated Treasurys face added selling pressure from this week’s record quarterly refunding after digesting 115 billion in new paper less than two weeks ago, analysts said.The start of the Treasury’s latest auctions will coincide with the Federal Reserve’s policy meeting which begins Tuesday.Economists have predicted the U.S. central bank will leave its near zero interest rate alone but may sprinkle more optimism in its economic outlook.Traders in the meantime will focus on clues to the Fed’s exit strategy from its quantitative easing policy and whether it will modify its purchase programs of Treasurys and mortgage-related securities.These programs have been pillars of the Fed’s monetary policy to combat the recession. They aim to hold down borrowing costs in effort to stimulate lending and the economy.On Monday, the Fed will buy Treasurys maturing in May 2012 to November 2013.

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NEW YORK (Reuters) — U.S. government bonds drifted lower Wednesday as investors took profits from the previous day’s gains inspired by Federal Reserve Chairman Ben Bernanke’s reassurances on the economy and the Fed’s ability to head off future inflation.Bernanke ignited the strongest long-bond rally in nearly two months on Tuesday by indicating the economy was too weak to tighten monetary policy any time soon but also by letting investors know he would end the era of easy money before inflation took off.He will appear before the Senate Banking Committee at 10 a.m., leaving investors to scrutinize some disappointing bank earnings in early New York trade and pause for breath after Tuesday’s massive gains.”It was a pretty strong rally yesterday and I think we will see some profit taking,” said Kim Rupert, managing director of global fixed income analysis at Action Economics LLC in San Francisco.”But, losses may be mitigated if stocks look to erode more rapidly.”Benchmark 10-year notes were last trading down 6/32 in price, yielding 3.50% versus 3.48% at Tuesday’s close.Volatility so far this week pushed yields up as far 3.72%, their highest since late June, but later brought them them back down close to their lowest in a week.The 30-year long bond was down 14/32, yielding 4.42%. On Tuesday, long bonds gained more than two points.

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NEW YORK (Reuters) — U.S. Treasurys prices rose Tuesday after Federal Reserve Chairman Ben Bernanke cautioned about consumer and job-market weakness.Bernanke also told a congressional committee the Fed — the U.S. central bank — would maintain an accommodative monetary policy for an extended period but was ready to reverse the easy money campaign when necessary.This reassured longer-term debt investors who might worry the Fed’s current approach would eventually fuel inflation, which erodes the value of fixed income investments and their cash flows.”What the bond market wanted to hear — and saw on page three of Bernanke’s text — is that the Fed has the tools to raise interest rates when that becomes necessary,” Cary Leahey, economist at Decision Economics in New York, said.”Bernanke said hardly anything about the economy, and when he did, he did not sound upbeat.”The benchmark 10-year Treasury note was last up 24/32 in price, pushing the yield down to 3.51% from 3.60% at Monday’s close.On Monday, 10-year yields rose as high as 3.7219%, their highest since June 23, before a rally pulled rates back down.The 30-year Treasury bond rallied more than a point and was last trading up 1-13/32 on the day, yielding 4.42%.

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NEW YORK (Reuters) — U.S. Treasurys fell Wednesday as stocks advanced on hopes for an economic recovery and a regional manufacturing index showed the slumping factory sector in New York state nearly pulled out of contraction in July.An improved outlook for the economy would tend to make investors more willing to buy riskier assets like stocks and lessen their appetite for safe-haven U.S. government debt.Stocks opened briskly higher after Intel Corp’s (INTC, Fortune 500) solid results and upbeat outlook reinforced hopes for an economic recovery and a rebound in technology spending.The New York Fed reported its “Empire State” general business conditions index rose to minus 0.55 in July from minus 9.41 in June, much better than economists’ expectations of minus 5.0, based on the median of forecasts in a Reuters poll.”We saw some positive numbers on orders and shipments, the first we had seen in a long time, which suggests that maybe the manufacturing sector is turning a corner,” said Gary Thayer, senior economist at Wells Fargo Advisors in St. Louis, Missouri. “It’s still a tentative sign, but consistent with other reports showing that the recession may be near an end.”Benchmark 10-year Treasury notes fell 16/32, their yields rising to 3.54% from 3.48% Tuesday.0:00
/5:15Intel’s sales on the riseThe Federal Reserve said U.S. industrial production fell a smaller-than-expected 0.4% in June, suggesting that the pace of recession eased in the second quarter.The government’s report that consumer prices rose 0.7% in June – but just a 0.2% excluding food and energy items – appeared to have little impact.”With the better economic news, there’s some renewed concern about inflation down the road, but nothing in today’s CPI report suggests an imminent inflation problem,” Thayer said.After a month-long rally, Treasurys have been on the defensive this week as U.S. stocks have advanced since Monday. Benchmark 10-year yields rose to 3.50% from a low near 3.25%.In morning trade, the 30-year bond was down more than a point, its yield rising to 4.46% from 4.38% Tuesday. Tuesday’s rise in the 30-year yield was the biggest in over five weeks.Two-year Treasury notes were down 1/32 in price, their yields rising to 0.97% from 0.95% late Tuesday, while five-year notes were down 9/32, their yields rising to 2.41% from 2.35% Tuesday.

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NEW YORK (Reuters) — U.S. Treasurys widened losses Tuesday after the government released reports on June retail sales and producer prices.June producer prices rose 1.8%, double economists’ consensus forecast. The bond market abhors inflation because it erodes the value of fixed-income investments.Benchmark 10-year Treasury notes, down 18/32 before the reports, were down 24/32 afterward, their yields at 3.44%, up from 3.35% late Monday.Retail sales rose a stronger-than-expected 0.6% in June. However, excluding both autos and gasoline, sales were down 0.2%, the fourth consecutive monthly decline.Thirty-year Treasury bonds, down 1-4/32 before the releases, were down 1-10/32 after the reports, their yields at 4.31%, up from 4.23% late Monday.

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NEW YORK (Reuters) — U.S. Treasury debt prices were narrowly mixed Monday, with yields hovering near seven-month lows, hurt by higher stock prices but aided by the prospect of a two-week hiatus from new supply.The risk averse trade was fed by news that CIT, a major U.S. lender to many small and medium-sized businesses, was in discussions with regulators to improve liquidity, after losses resulted in a capital crunch. Bonds of CIT Group Inc. (CIT, Fortune 500) fell more than 8 points on Monday.Still, stocks opened higher as shares of major U.S. banks advanced following positive comments from influential analyst Meredith Whitney on CNBC television. Known for a bearish stance on banks, Whitney provided a reassuring assessment of the sector’s performance.Two, three, and five-year notes were unchanged, yielding 0.91%, 1.41%, and 2.23%, respectively.Benchmark 10-year notes were down 4/32, their yields rising to 3.32% from 3.31% Friday. Investors’ overall aversion to risk allowed the Treasury market to overcome last week’s “supply deluge,” said John Spinello, senior vice president and chief fixed-income technical strategist at Jefferies & Co. in New York.After “heavy buyside activity from the large institutional client base and heavy buying from the foreigners in the secondary market and likely the auctions as well” let it absorb last week’s supply, the market this week will benefit from a lack of new supply, Spinello said.Indeed, some supply will be taken out of the market when the Federal Reserve buys securities this week, starting on Tuesday with purchases of securities maturing May 31, 2011 to April 30, 2012. The Fed will buy 20-year TIPS on Thursday.With yields near seven-month lows, the market faces “extremely high” event risk this week from economic data, corporate earnings and forecasts released by the Fed’s policy-making Federal Open Market Committee (FOMC), said TJ Marta, a bond strategist at Marta on the Markets.Figures on June retail sales are due Tuesday and are expected to be fairly subdued. Producer and consumer price inflation reports are due Tuesday and Wednesday, respectively, and are expected to be up because of higher energy prices.Stronger-than-forecast retail sales could deal the bond market a setback, as could higher-than-predicted inflation, analysts said.Housing data due later in the week are expected to show that sector remains very weak.”The ongoing trend toward lower rates has overcome any overextended readings and Treasurys, equities, currencies and commodities will require some sort of information catalyst to reverse the current overextended condition,” Spinello said.On Monday, the market could consolidate, with little for the market to focus on except equity activity and monthly federal budget figures, he said.Profit-taking is likely to emerge when 10-year yields trade to resistance at 3.25%-3.24%, Spinello added.

Source:CNN

NEW YORK (Reuters) — U.S. government debt prices climbed Friday, as investors searched for bargains following Thursday’s sell-off and on the view of a distant, sluggish economic recovery.Investors also jumped back into Treasurys on worries over second-quarter earnings and relief the market digested this week’s 73 billion in long-dated supply without much of a hitch, analysts said.”People are coming to the realization that the economy is not out of the woods,” said Ron D’Vari, chief executive officer at New Oak Capital in New York.A profit warning from Chevron Corp (CVX, Fortune 500) pushed stocks lower and underscored recent evidence signaling the U.S. economy continues to deteriorate albeit at a slower rate.On Friday, government data showed a surprise contraction in the U.S. trade gap in May and bigger-than-expected increases in export and import prices. These reports suggest some stabilization on the global trade front.The trade deficit shrank to 25.96 billion in May, the smallest since November 1999, while U.S. import prices jumped 3.2% in June, the largest single-month rise since November.The price on benchmark 10-year Treasury notes were last up 23/32 at 98-11/32. Their yield which moves inversely to the price was 3.33% down from 3.41%Thursday. The 10-year yield is not far above the seven-week low of 3.28% set two days ago.

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NEW YORK (Reuters) — U.S. Treasury debt prices held steady at lower levels early Thursday after weekly data suggested slowing deterioration in the labor market, although the number of unemployed workers climbed to a record high.The government reported 565,000 U.S. workers filed for initial unemployment benefits last week, the fewest since January. This was well below the 605,000 forecast by analysts polled by Reuters and the previous week’s revised reading of 617,000.However, the number of people collecting jobless aid hit a record 6.883 million in the week to June 27, signaling the employment picture remains bleak.The price on benchmark 10-year Treasury notes was down 19/32 to 98-28/32, compared with a 12/32 fall shortly before the jobless claims data.Their yield, which moves inversely to price, was 3.38%, compared with 3.36% before the data. The 10-year yield finished Wednesday at 3.31%, a seven-week low.The 30-year bond slipped 1-7/32 to 99-23/32 and yielded 4.27%. The 2-year note fell 1/32 to trade at 100-12/32, and its yield ticked up to 0.94%.The 3-month bill yielded 0.19%.

Source:CNN

NEW YORK (Reuters) — U.S. Treasury debt prices traded higher Wednesday as investors prepare for a 19 billion sale of 10-year notes following solid demand for government bonds earlier this week.U.S. stock losses and worries over a protracted recession have boosted appetite for Treasury securities, analysts said.The U.S. Treasury Department is scheduled to sell 73 billion in longer-dated debt this week.”The market is absorbing the supply pretty well. There’s still a lot money on the sidelines, and there’s still a lot of nervousness about the economy,” said James Swanson, portfolio manager with MFS Investment Management in Boston.Uneasiness that the recession could linger through year-end has revived speculations the government may launch a second stimulus package. That has ignited concerns federal borrowings could balloon, resulting in more Treasury issuance that erodes their value, according to analysts.The Treasury is already expected to sell 2 trillion in new debt this fiscal year.”As economists debate the need for yet more fiscal stimulus, we wonder whether yet more debt will be a destroyer or creator of future economic health,” UBS analysts wrote in a research note Wednesday.At the moment, investors have not shied from Treasurys amid jitters over the start of the quarterly earnings session.Prices: Benchmark 10-year Treasury notes were up 5/32 in price at 97-13/32. Their yield, which moves inversely to their price, was 3.44% versus 3.45% late Tuesday.The 10-year yield is at its lowest since late May, below the eight-month high of 4% reached more than three weeks ago.The 30-year long bond was up 14/32 to 99-14/32, and it yielded 4.29%. The 2-year note was up less than 1/32 to trade at 100-10/32, and its yield held ay 0.97%.In the meantime, the Treasury will announce at about 1 p.m. the results on the reopening of a 10-year issue it originally introduced at the May refunding.Wednesday’s sale will enlarge this 10-year issue, which matures in May 2019 to about 60 billion.This week’s Treasury auctions will conclude Thursday with a 11 billion reopening of an older 30-year bond issue.

Source:CNN

NEW YORK (Reuters) — U.S. government debt prices fell Tuesday, as investors made room for 35 billion in new three-year notes and concerns increased on talk of a second stimulus package that could boost federal borrowing.The Treasury’s three-year debt sale followed strong bidding at Monday’s auction of 8 billion in 10-year inflation securities. The Treasury will conduct a 19 billion 10-year regular note reopening on Wednesday and a 11 billion 30-year bond reopening on Thursday.Traders “want to come out of these auctions long,” said Glen Capelo, co-head of rates at BroadPoint Capital in New York.The Treasury will announce the results of the three-year note sale about 1 p.m..Recent sales signaled solid demand here and abroad for U.S. government debt, but there are nagging worries the unrelenting supply to fund the government’s economic bailout could outstrip demand, analysts said.Laura D’Andrea Tyson, an advisor to President Barack Obama, said the United States should be planning for a second fiscal stimulus program in a bid to end the recession.Last week’s disappointing jobs data have fueled talks that the government may have do more to stimulate the economy.Furthermore, the United States is competing with other countries to raise money in the bond market. The U.S. Treasury is expected to issue 2 trillion in new debt this fiscal year to finance the first fiscal stimulus and other bailouts.For example, the Dutch Treasury is looking to sell about 6 billion euros in five-year debt Tuesday.In the open market, benchmark 10-year notes were down 7/32 in price at 96-18/32. Their yield which move inversely to their price was 3.54%, up from 3.51% late Monday.Among shorter maturities, 2-year notes were down 1/32 to yield 0.97%, up from 0.95% late Monday, while 3-year notes were down 2/32 for a 1.47%, up from 1.46% late Monday.

Source:CNN