By Wallace Witkowski and Greg Morcroft, MarketWatch
SAN FRANCISCO (MarketWatch) — U.S. Treasury prices rose Friday, sending yields lower, as reports of a credit downgrade for many euro-zone countries materialized after U.S. markets closed.
The benchmark 10-year Treasury note 10_YEAR -0.22% fell 6 basis points to 1.87% late Friday. The 10-year note has shed 11 basis points for the week. Bond yields move inversely to price.
The 30-year bond 30_YEAR -0.10% also shed 6 basis points for a yield of 2.9%.
U.S. and European stocks closed lower following reports that ratings agency Standard & Poor’s could move as early as Friday to downgrade euro-zone countries’ debt.
Those reports gained momentum throughout the day and after the close of U.S. markets, S&P cut France’s and Austria’s triple-A rating by a notch and downgraded Portugal’s rating to junk status. Germany managed to hold onto its triple-A rating. Read more on S&P sovereign downgrades.
Prices on the 5-year and 7-year notes also rose on falling yields. The yield on the 5-year note 5_YEAR +0.25% fell 4 basis points at 0.79% and the yield on the 7-year note 7_YEAR +0.23% declined 5 basis points at 1.31%.
Earlier, Treasury prices also rose after reports the U.S. trade deficit widened after four straight months of narrowing.
The U.S. trade deficit widened by 10.4% in November to $47.8 billion, the Commerce Department said Friday. This is the largest trade gap since June and the biggest jump in the deficit since May. See MarketWatch report on government data
Import prices slipped 0.1% in December, according to the government.
Wallace Witkowski is a MarketWatch news editor in San Francisco.
Greg Morcroft is MarketWatch's financial editor in New York.
