RTTN: Treasuries Rallying Amid Continued Uncertainties In Europe
(RTTNews) - Treasuries are in rally mode once again on Thursday, as renewed civil unrest in Greece and continued uncertainty regarding the solidarity of major European economies have once again prompted a flight to safety.
Bond prices opened notably higher and are holding near their best levels of the session. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, is trading at 3.262 percent, posting a loss of 9.7 basis points.
With the move, the ten-year yield is extending a recent downward move, falling to its lowest intraday level in well over five months.
Bonds have shot higher in the early going after workers in Greece called for a total strike in opposition to the austerity measures proposed by the European Union.
Consequently, traders are once again moving out of the embattled euro-zone currency, looking instead towards safe havens provided by U.S. bonds and the U.S. dollar.
Earlier this week, German Chancellor Angela Merkel warned that the euro is in danger and that the consequences will be "incalculable" if Europe fails to deal with the crisis. Friday, the markets will look to a key vote in Germany regarding its input to the financial aid package constructed by the EU and the International Monetary Fund.
Disappointing employments from the U.S. may also be contributing to the strength among bonds, with the Labor Department reporting that first-time claims for unemployment benefits unexpectedly showed a notable increase in the week ended May 15th after falling for four consecutive weeks.
Initial jobless claims rose to 471,000 from the previous week's revised figure of 446,000. The increase surprised economists, who had expected jobless claims to slip to 439,000 from the 444,000 originally reported for the previous week.
At 10:00 a.m. ET, the Conference Board will release its index of leading economic indicators for April. Economists expect the index to show a 0.2 percent increase for the month following the 1.4 percent increase reported in the previous month.
At the same time, the Philadelphia Federal Reserve will issue a report on manufacturing activity for May. Economists expect the index of current activity to show a reading of 20.7 compared to April's reading of 20.2.
