Treasuries Give Back Ground Following Recent Upward Move

(RTTNews) - Treasuries moved notably lower over the course of the trading day on Thursday, giving back some ground are moving sharply higher over the past few sessions.

After failing to sustain an initial upward move, treasuries turned lower in morning trading before moving roughly sideways in the afternoon. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, rose by 6.3 basis points to 2.153 percent.

With the increase on the day, the ten-year yield broke a recent losing streak after ending the previous session at its lowest closing level in well over a year.

The pullback by treasuries was partly due to the release of some better than expected U.S. economic data, including a Labor Department report showing that initial jobless claims unexpectedly fell to their lowest level in over fourteen years in the week ended October 11th.

The report said initial jobless claims fell to 264,000, a decrease of 23,000 from the previous week's unrevised level of 287,000. The decrease came as a surprise to economists, who had expected jobless claims to edge up to 290,000.

With the unexpected decrease, jobless claims fell to their lowest level since hitting 259,000 in the week ended April 15, 2000.

A separate report from the Federal Reserve showed that industrial production rebounded by much more than expected in the month of September.

The Fed said industrial production surged up by 1.0 percent in September after edging down by a revised 0.2 percent in August. Economists had been expecting production to increase by about 0.4 percent.

On the other hand, the Philadelphia Fed released a report showing a slower rate of growth in regional manufacturing activity, and the National Association of Home Builders said homebuilder confidence has unexpectedly deteriorated in October.

The downturn by treasuries may also have reflected a recovery on Wall Street, with stocks showing a notable rebound after falling sharply at the open.

Economic data may remain in focus during trading on Friday, with traders likely to keep an eye on reports on housing starts and consumer sentiment.

Fed Chair Janet Yellen is also due to deliver a speech at a Boston Fed conference, although her remarks are expected to focus on inequality of economic opportunity.