NEW YORK (MarketWatch) -- Treasurys fell sharply early on Thursday, as European and U.S. stock markets firmed amid a return of risk appetite, diminishing the safe-haven appeal of government bonds. The Treasury is set to auction more notes and bonds and the expected new supply of debt is also weighing on prices. The yield of the benchmark 10-year Treasury note gained 14 basis points, or 0.14%, to 3.777%. Two-year note yields rose 15 basis points, or 0.15%, to 1,709%. Bond yields move inversely to price. U.S. stocks opened firmly higher, partly in response to indications the U.S. Treasury will use provisions in the recently enacted $700 billion bailout bill to re-capitalize troubled banks. (Correcting to reflect that Treasurys fell sharply, while yields rose).
