By Deborah Levine, MarketWatch
NEW YORK (MarketWatch) — Treasury prices declined slightly Wednesday, pushing yields higher for the first day in five, after ADP said U.S. private-sector employers added 179,000 jobs in April.
Before the data were released, U.S. bonds were under pressure as details about a bailout package for Portugal came to light, weighing on European bonds.
Yields on 10-year notes UST10Y -0.12% , which move inversely to prices, rose 2 basis points to 3.27%. A basis point is 1/100th of a percent.
Yields on 2-year notes UST2YR +1.98% increased 2 basis points to 0.63%.
Thirty-year bond yields UST30Y -0.23% were little changed at 4.35%.
The ADP data showed fewer jobs were added last month than some analysts expected. The report comes two days before the more closely followed Labor Department payrolls report, which encompasses both the private- and public-sector labor markets. See story on ADP jobs report.
“This week, the sentiment of the market is one of economic concern — concern that we continue to receive only muted job growth or worse,” said strategists at RBS Securities in a note. “This shift follows the market’s recognition of the current slowdown in first-quarter GDP (which helped take yields from 3.60% to here), and worries that the second quarter will not show the reacceleration of growth we are looking for.”
Also, the Treasury Department announced it will sell $72 billion in notes and bonds next week, the same amount as at the last quarterly refunding in February, although some analysts expected the government to reduce auction sizes. Read more on Treasury refunding announcement.
Still to come is the ISM’s services index and a Federal Reserve buyback.
On Tuesday, 10-year yields fell to their lowest level since mid-March, continuing a trend as investors reconsider the outlook for U.S. economic growth.
