MW: Treasurys slip after claims hint at labor recovery
By Laura Mandaro, MarketWatch
SAN FRANCISCO (MarketWatch) — U.S. Treasurys started with a slight loss Thursday, sending yields higher, after jobless claims made a steeper-than-forecast drop and ahead of a 30-year bond auction.
Yields on the 10-year note 10_YEAR +3.81% rose 1 basis point to 1.70% as prices, which move inversely to yields, slipped. Yields on the 30-year bond 30_YEAR +1.09% gained 2 basis points to 2.77%. One basis point is 1/100th of a percentage point.
Yields turned higher after the Labor Department said the number of Americans filing for jobless benefits fell 6,000 to 361,000 last week, contrary to an expected rise to 370,000. Read more on jobless claims.
Stocks rose slightly in early trade, extending a low-volume shift into equities and away from safe-havens such as Treasurys that has marked much of the past week’s trading.
“The initial jobless claims data over the last three weeks hint at a slowing in the rate of gross job losses (and thus higher net job creation) compared to the April-June timeframe,” wrote John Ryding and Conrad DeQuadros of RDQ Economics, in a note.
“The labor market is suddenly not looking quite so moribund,” they added.
At 1 p.m. the Treasury will announce results from a $16 billion auction of 30-year note. The prior two auctions of the week, of 10-year and 3-year notes, have shown weak demand as investors have stayed away from debt after a steep rally earlier this year. The 10-year note’s yield is now about 30 basis points higher than record low yields touched in July, at the height of a recent panic over Spanish debt.
Laura Mandaro is a MarketWatch editor, based in San Francisco.
