Treasuries Give Back Ground On Upbeat Economic Data

(RTTNews) - After trending higher over the past few sessions, treasuries gave back some ground on Wednesday on the heels of a batch of largely upbeat U.S. economic data.

Bond prices showed a notable move to the downside in morning trading but regained some ground in the afternoon. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, ended the day up by 4 basis points 2.736 percent.

The weakness among treasuries came on the heels of the release of a slew of economic data, including a report from the Labor Department showing an unexpected decrease in initial jobless claims in the week ended November 23rd.

The Labor Department said initial jobless claims slid to 316,000, a decrease of 10,000 from the previous week's revised figure of 326,000. Economists had expected jobless claims to climb to 330,000.

Jobless claims continued to offset the sharp jump seen as a result of technical issues in the first week of October, falling to their lowest level in almost two months.

Adding to the selling pressure, revised data released by Thomson Reuters and the University of Michigan showed an improvement in consumer sentiment in the month of November.

The report said the final reading on the consumer sentiment index for November came in at 75.1, reflecting a substantial upward revision from the preliminary reading of 72.0. With the upward revision, the index came in above the October reading of 73.2.

The Conference Board also released a report showing that its reading on leading U.S. economic indicators unexpectedly rose for the fourth straight month in October.

On the other hand, the Commerce Department released a separate report showing a pullback in new orders for U.S. manufactured durable goods in the month of October.

The report said durable goods orders fell by 2.0 percent in October after jumping by an upwardly revised 4.1 percent in September. The drop in orders matched economist estimates.

Excluding a decrease in orders for transportation equipment, durable goods orders edged down by a more modest 0.1 percent in October compared to a 0.2 percent increase in September.

Meanwhile, traders largely shrugged off the release of the results of the Treasury Department's auction of $29 billion worth of seven-year notes, which attracted below average demand.

The seven-year note auction drew a high yield of 2.106 percent and a bid-to-cover ratio of 2.36, while the ten previous seven-year note auctions had an average bid-to-cover ratio of 2.59.

The bid-to-cover ratio is a measure of demand that indicates the amount of bids for each dollar worth of securities being sold.

Following the Thanksgiving Day holiday on Thursday, trading activity on Friday is likely to be subdued amid a lack of major U.S. economic data.