U.S. Treasuries declined, pushing the 10-year yield up for the first time in three days, as a rally in stocks reduced demand for the securities as a haven. The losses pushed the yield up from within a basis point of the lowest since March 24. The Stoxx Europe 600 Index gained 0.6 percent, after tumbling 1.7 percent yesterday, and U.S. futures erased earlier declines. Treasuries gained earlier as Japanese Finance Minister Yoshihiko Noda said at a press conference in Tokyo today that the debt remains “attractive” even after the U.S. had its credit rating outlook was cut by Standard & Poor’s yesterday. “Equities are recovering a bit of what they lost yesterday and we are seeing Treasury yields edging higher, although it’s not a massive move,” said Niels From, chief analyst at Nordea Bank AB in Copenhagen. “While we had risk-off sentiment yesterday, it appears that this is being reversed a bit and that might also be what’s impacting the Treasury curve.” Ten-year yields rose two basis points to 3.40 percent at 7:49 a.m. in New York, according to Bloomberg Bond Trader prices. They dropped earlier to 3.37 percent, after falling yesterday to as low as 3.36 percent, the least since March 24. The 3.625 percent note due in February 2021 lost 5/32 or $1.56 per $1,000 face amount to 101 28/32. Yields are down from 3.80 percent a year ago and below the average of 5.21 percent over the last two decades even with the U.S. projected to post a deficit in excess of $1 trillion for a third consecutive year. To contact the reporters on this story: Lukanyo Mnyanda in Edinburgh at lmnyanda@bloomberg.net To contact the editor responsible for this story: Daniel Tilles at dtilles@bloomberg.net

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