MW: Treasurys fall, little reaction to economic data
By Saumya Vaishampayan, MarketWatch
NEW YORK (MarketWatch) -- Treasurys fell on Friday, pushing yields higher, but registering little reaction to the release of industrial production data and the Empire State manufacturing index.
Yields on the benchmark 10-year U.S. Treasury note 10_YEAR +1.80% rose 4 basis points to 2.04%. Yields move inversely to prices and one basis point is one one-hundredth of a percentage point.
“There doesn’t seem to be a lot of volatility in the Treasury market. It isn’t reacting all that much to data,” said Mike Materasso, senior vice president and co-chair of Franklin Templeton’s fixed-income policy committee.
Yields on the 10-year have been in a “pretty tight range,” attracting sellers when they dip to low end of 1.9% and attracting buyers when they rise above 2%, he said. “There’s probably a little bit of re-shifting of investors within these ranges,” Materasso said.
Going forward, fiscal policy negotiations in Washington, D.C., could impact Treasurys in terms of creating a flight to quality, he said.
Yields on the 30-year Treasury bond 30_YEAR +0.88% rose 4 basis points to 3.21% and yields on the five-year note 5_YEAR +3.61% rose 3 basis points to 0.89%.
In other news, The University of Michigan-Thomson Reuters consumer-sentiment gauge rose to its highest level in three months, with a preliminary February reading of 76.3 compared with January’s final reading of 73.8. Economists had expected a reading of 75, according to economists polled by MarketWatch. Read more: Consumer sentiment highest in three months .
Treasurys weren’t impacted by U.S. industrial production data. Production fell 0.1% in January compared with gains of 1.4% and 0.4% in November and December, respectively, the Federal Reserve said Friday. Initial estimates for November and December were 1% and 0.3%. Read more: Industrial production slips in January .
Similarly, Treasurys remained unchanged after the Empire State index, which showed an improvement in the region’s manufacturing activity for the first time in seven months. The index was 10 in February compared with negative 7.8 in January, according the New York Federal Reserve. Read more: Manufacturing improves in New York .
Stocks were slightly higher, with the Standard & Poor’s 500 Index SPX +0.08% rising 0.1%, or 1.63 points, to 1,523.01. The Nasdaq Composite Index COMP +0.10% also gained 0.1%, or 3.58 points, to 3,202.26 and the Dow Jones Industrial Average DJIA +0.12% rose 0.2%, or 20.2 points, to 13,993.13.
Saumya Vaishampayan is a MarketWatch reporter based in New York.
