By Ben Eisen, MarketWatch
NEW YORK (MarketWatch) -- Treasury prices moved higher Monday, as investors used a familiar yield threshold to jump into the market after three weeks of declines.
The 10-year note 10_YEAR -0.31% yield lingered around 1.95% overnight, which created investor demand that pushed prices up and yields down to 1.934%, a 2-basis-point drop.
“In this post-April-jobs-report correction, we’ve hit this level a couple of times,” said Kevin Flanagan, chief fixed-income strategist for Morgan Stanley Wealth Management, noting that 1.95% has served as a tactical inflection point for the direction of yields on the benchmark note.
The 30-year bond 30_YEAR -0.47% yield traded down 2.5 basis points at 3.144%, while the 5-year note 5_YEAR 0.00% traded down 1 basis point at 0.825%.
The price movements kick off a week with a number of public appearances by Federal Reserve officials but few data releases. As the Treasury market continues to chatter about when and how the Fed may taper its bond-purchase program that has artificially held down interest rates, those speeches will be mined for possible clues.
Chicago Fed President Charles Evans will speak about monetary policy at 1 p.m. Monday. Earlier in the day Dallas Fed President Richard Fisher said on CNBC he would have voted to start tapering the purchase of mortgage-backed securities at the last Fed meeting. He isn’t a voting member of the rate-setting body this year.
Further ahead, St. Louis Fed President James Bullard and New York Fed President William Dudley are on tap for Tuesday. The most-watched appearance, however, will be by Fed Chairman Ben Bernanke when testifies before Congress on Wednesday.
“No doubt Bernanke will have the stage and platform to discuss QE and put to rest [the question of] are we going to start tapering easing?” Flanagan said.
The Fed will release the minutes of its last regular meeting later on Wednesday.
The Chicago Fed’s National Activity Index on Monday reported a negative 0.53 in April, down from the negative 0.23 reported in March. A zero recording of the index indicates trend growth and negative 0.70 indicates an increased likelihood of recession.
Stocks were down on the tail of news about deals involving Yahoo Inc.’s purchase of blogging site Tumblr and drug-maker Activis Inc.’s buyout of Warner Chilcott PLC. The Dow Jones Industrial Average DJIA -0.04% was down 31 points while the S&P 500 index SPX +0.03% was down 1 point. Gold prices GCM3 -0.59% were down $10 to $1,355.
Ben Eisen is a MarketWatch reporter based in New York.
