Treasuries Close Moderately Higher, Extending Last Friday's Rally

(RTTNews) - After moving sharply higher over the course of the previous session, treasuries saw some further upside during trading on Monday.

Bond prices moved modestly higher in early trading and climbed more firmly into positive territory as the day progressed. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, fell by 3.3 basis points to 2.827 percent.

With the drop on the day, the ten-year yield added to the 10.3 basis point loss posted last Friday, falling to its lowest closing level in a month.

The strength among treasuries came as traders continued to digest the Labor Department's monthly employment report, which showed much weaker than expected job growth in the month of December.

The report said non-farm payroll employment edged up by 74,000 jobs in December compared to economist estimates for an increase of about 200,000 jobs.

While the report also showed that the unemployment rate unexpectedly dropped to a five-year low of 6.7 percent, the decrease came as some unemployed people gave up looking for work.

The weaker than expected job growth eased concerns that the Federal Reserve will accelerate its tapering of bond purchases.

Trading on Tuesday is likely to be impacted by the release of the Commerce Department's retail sales report, which is expected to show flat sales in December. Reports on import and export prices and business inventories are also scheduled to be released.