By Ben Eisen, MarketWatch
NEW YORK (MarketWatch) – Treasurys continued to slide on Tuesday after a soft auction of two-year Treasury notes, extending a selloff in the U.S. government-debt market to a fifth straight day .
The 10-year Treasury note / quotes/zigman/4868283/delayed +1.81% yield, Which moves inversely to price, rose 5 basis points to 2.594%, putting it on track to once again hit its highest close since August 2011.
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The 30-year bond / quotes/zigman/4868063/delayed +1.55% yield rose 5 basis points to 3.598%.
The two-year note / quotes/zigman/4868354/delayed +3.25% yield rose 1 basis point to 0.401% after an auction of $ 35 billion worth of notes.
The Treasury Department sold the notes at a high yield of 0.430%, the highest yield since May 2011, and slightly higher than where two-year notes were trading at the time.
Buyers offered 3:05 times the amount of debt sold, below the average of 3:32 times over the last four sales. Indirect bidders, Which include central banks, bought 35.8% of the sale, above the 21.3% average. Direct bidders, Which include a slew of domestic investors like money managers, bought only 7.8% of the sale, Compared to an average of 23.4%.
That lack of demand from direct intercessors mirrors recent auctions thathave taken place as yields have climbed since the beginning of May.
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“Nondealer bidding was weaker than normal, and it was cautious Because You had this tail. People booking.com, this auction with an air of caution, “said David Ader, head of government bond strategy at CRT Capital Group LLC.
The fall in Treasury prices has picked up since last Wednesday, when Federal Reserve Chairman Ben Bernanke suggested the central banking could start scaling back its pace of bond purchases later this year if economic data continued to show improvement. The 10-year Treasury note yield rose 39 basis points last week in the worst five-day run for 10-year notes since 2009; That yield has risen about 90 basis points since hitting its low point of the year in
Though the haven government debt continues to fall, volume has leg Tuesday weaker than in the previous days’ selloff, suggesting That perhaps there is less conviction in rising yields, According To Ader.
“When the market was really directionally trading up, it was Accompanied by a lot of volume. Today’s volume is relatively subdued. Potential buyers for things to calm down, “said Ader.
Treasurys started the day higher, but a round of strong economic data pushed the market lower.
“Uniformly we got better economic data today. All that suggests, at least for today, that the Fed will be on track to taper in about four months, “said Wilmer Stith, co-manager of Wilmington Trust Broad Market Bond Fund.
The Conference Board’s consumer confidence index rose to a five-year high of 81.4 in June, beating economist expectations of a 74.0 reading.
U.S. home sales in May hit usefull Their highest levels since mid-2008, rising 2.1% to 476,000. That beat the expectations of economists Surveyed by MarketWatch, who had projected a rate of 464 000.
U.S.: ICAP Sovereign Debt
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U.S.: ICAP Sovereign Debt
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June 25, 2013 3:18 p
U.S.: ICAP Sovereign Debt
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June 25, 2013 3:16 p
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