Treasuries Give Back Ground Following Last Week's Strength

(RTTNews) - After moving notably higher over the course of the previous week, treasuries gave back some ground during trading on Monday.

Bond prices moved to the downside in early trading and remained stuck in the red throughout the session. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, rose by 2 basis points to 2.609 percent.

With the increase on the day, the ten-year yield climbed further off the two-month closing low set last Thursday.

The modest weakness among treasuries came as some traders cashed in on last week's strength, which reflected optimism that the Federal Reserve will maintain its asset purchase program for the foreseeable future in light of the government shutdown.

Traders were also looking ahead to the release of the Labor Department's monthly jobs report, which is scheduled for tomorrow morning.

The September jobs report was originally scheduled for release on October 4th but was delayed as a result of the shutdown.

Economists expect the report to show an increase about 185,000 jobs in September compared to the addition of 169,000 jobs in August. The unemployment rate is expected to remain unchanged at 7.3 percent.

Meanwhile, traders largely shrugged off the release of a report from the National Association of Realtors showing that existing home sales pulled back in the month of September after reaching their highest level in nearly four years.

NAR said existing home sales fell 1.9 percent to a seasonally adjusted annual rate of 5.29 million in September from a downwardly revised 5.39 million in August.

Economists had been expecting existing home sales to drop to an annual rate of 5.30 million from the 5.48 million originally reported for the previous month.

Trading on Tuesday is likely to be impacted by reaction to the monthly jobs report, while the Commerce Department is also due to release its report on construction spending.