Treasuries Close Nearly Flat For Second Straight Day

(RTTNews) - Treasuries showed a lack of direction throughout much of the trading day on Thursday before closing roughly flat for the second straight session.

Bond prices spent the trading session bouncing back and forth across the unchanged line. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, ended the day down by less than a basis point at 2.13 percent.

While the ten-year yield showed only a modest drop, it still ended the session at its lowest closing level in almost a month.

The choppy trading by treasuries came as traders expressed continued uncertainty about the situation in Greece while also digesting upbeat U.S. housing data.

The National Association of Realtors released a report this morning showing that pending home sales jumped to their highest level in nearly nine years.

NAR said its pending home sales index surged up 3.4 percent to 112.4 in April from a slightly upwardly revised 108.7 in March. Economists had expected the index to increase by about 0.8 percent.

A pending home sale is one in which a contract was signed but not yet closed. Normally, it takes four to six weeks to close a contracted sale.

With the bigger than expected increase, the pending home sales index reached its highest level since hitting 112.5 in May of 2006.

Bond traders were also digesting the results of the Treasury Department's auction of $29 billion worth of seven-year notes, which attracted average demand.

The seven-year note auction drew a high yield of 1.888 percent and a bid-to-cover ratio of 2.49, while the ten previous seven-year note auctions had an average bid-to-cover ratio of 2.47.

The bid-to-cover ratio is a measure of demand that indicates the amount of bids for each dollar worth of securities being sold.

The nearly flat close by treasuries also came as traders were looking ahead to the release of some key economic data on Friday, including reports on first quarter GDP, consumer sentiment, and Chicago-area business activity.