Treasuries Close Nearly Unchanged Following Lackluster Session

(RTTNews) - After ending the previous session modestly lower, treasuries showed a lack of direction over the course of the trading day on Thursday.

Bond prices spent much of the day lingering near the unchanged line before closing nearly flat. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, ended the day unchanged at 1.487 percent.

The lackluster performance by treasuries came as the day's economic data painted a positive picture but missed economist estimates.

Early in the day, the Labor Department released a report showing a modest decrease in first-time claims for U.S. unemployment benefits in the week ended June 19th.

The Labor Department said initial jobless claims edged down to 411,000, a decrease of 7,000 from the previous week's revised level of 418,000.

However, economists had expected jobless claims to drop to 380,000 from the 412,000 originally reported for the previous week.

A separate report from the Commerce Department showed new orders for U.S. manufactured durable goods rebounded in the month of May but fell short of expectations.

The report said durable goods orders surged up by 2.3 percent in May after falling by a revised 0.8 percent in April.

Economists had expected durable goods orders to spike by 2.7 percent compared to the 1.3 percent slump that had been reported for the previous month.

Excluding orders for transportation equipment, durable goods orders rose by 0.3 percent in May after jumping by 1.7 percent in April. Ex-transportation orders were expected to increase by 0.7 percent.

Bond traders also shrugged off the results of the Treasury Department's auction of $62 billion worth of seven-year notes, which attracted modestly above average demand.

The seven-year note auction drew a high yield of 1.264 percent and a bid-to-cover ratio of 2.36, while the ten previous seven-year note auctions had an average bid-to-cover ratio of 2.31.

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

Earlier this week, the Treasury revealed its auction of $60 billion worth of two-year notes attracted average demand, while its auction of $61 billion worth of five-year notes attracted slightly below average demand.

Trading on Friday may be impacted by reaction to a report on personal income and spending, which includes a reading on inflation said to be preferred by the Federal Reserve.