Treasuries Close Modestly Lower Ahead Of Jobs Report

(RTTNews) - After closing nearly flat for two straight days, treasuries moved modestly lower over the course of the trading session on Thursday.

Bond prices showed a lack of direction in early trading but slid more firmly into the red as the day progressed. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, rose by 2.5 basis points to 2.375 percent.

With the increase on the day, the ten-year yield extended the upward trend seen in recent weeks, reaching its highest closing level in a month.

The modest weakness among treasuries came as traders looked ahead to tomorrow's closely watched monthly jobs report. Economists expect the report to show an increase of about 240,000 jobs in October.

Generating some optimism about the jobs report, the Labor Department released a report this morning showing a bigger than expected drop in initial jobless claims.

The Labor Department said initial jobless claims fell to 278,000 in the week ended November 1st from the previous week's revised level of 288,000. Economists had expected jobless claims to edge down to 285,000.

A separate Labor Department report said labor productivity increased by more than expected in the third quarter amid another notable increase in output.

Traders were also digesting comments from European Central Bank President Mario Draghi, who indicated that the central bank is willing to provide additional stimulus.

"Should it become necessary to further address risks of too prolonged a period of low inflation, the Governing Council is unanimous in its commitment to using additional unconventional instruments within its mandate," Draghi said.

He added, "The Governing Council has tasked ECB staff and the relevant Eurosystem committees with ensuring the timely preparation of further measures to be implemented, if needed."

The monthly jobs report is likely to be in the spotlight on Friday, although traders are also likely to keep an eye on comments by Federal Reserve Chair Janet Yellen.