Treasuries Close Modestly Higher After Lackluster Session

(RTTNews) - Treasuries showed a lack of direction over the course of the trading day on Thursday before ending the session modestly higher.

After bouncing back and forth across the unchanged line in morning trading, bond prices moved roughly sideways in the afternoon. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, edged down by 1.7 basis points to 1.864 percent.

The modestly higher close by treasuries came as traders kept a close eye on the price of crude oil, which saw considerable volatility on the day.

Crude for March delivery eventually finished the session down $0.56 at $31.72 a barrel after reaching a high of $33.60 a barrel.

Nonetheless, trading activity was somewhat subdued ahead of the release of the Labor Department's monthly jobs report on Friday.

Employment is expected to increase by about 188,000 jobs in January after jumping by 292,000 jobs in December. The unemployment rate is expected to hold at 5.0 percent.

The Labor Department released a report this morning showing that initial jobless claims rose more than expected in the week ended January 30th.

The report said initial jobless claims climbed to 285,000, an increase of 8,000 from the previous week's revised level of 277,000. Economist had expected jobless claims to inch up to 280,000.

A separate report from the Labor Department showed that labor productivity fell by more than anticipated in the fourth quarter.

The report said labor productivity dropped by 3.0 percent in the fourth quarter after climbing by 2.1 percent in the third quarter. Economists had expected productivity to decline by 1.8 percent.

Meanwhile, the Labor Department also said unit labor costs jumped by 4.5 percent in the fourth quarter following a 1.9 percent increase in the third quarter. Costs had been expected to rise by 4.4 percent.

The Commerce Department also released a report showing that factory orders tumbled by 2.9 percent in December amid a sharp drop in durable goods orders.

The monthly jobs report is likely to be in the spotlight on Friday, overshadowing a separate report on the U.S. trade deficit.