Treasuries Close Roughly Flat For Third Consecutive Session

(RTTNews) - Treasuries recovered from an early move to the downside on Thursday but showed a lack of direction throughout the remainder of the session.

Bond prices spent the afternoon bouncing back and forth across the unchanged line before closing roughly flat. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, inched up by less than a basis point to 1.570 percent.

Treasuries closed near the unchanged line for the third consecutive session as traders continued to look ahead to the Labor Department's monthly jobs report due Friday morning.

The report is expected to show an increase of about 175,000 jobs in August following the jump of 255,000 jobs in July. The unemployment rate is expected to edge down to 4.8 percent from 4.9 percent.

The jobs data is likely to have a significant impact on expectations regarding whether the Federal Reserve will raise interest rates at its next meeting later this month.

While some early weakness was visible in the bond markets, treasuries rebounded following the release of a report from the Institute for Supply Management showing an unexpected contraction in manufacturing activity in the month of August.

The ISM said its purchasing managers index slumped to 49.4 in August from 52.6 in July, with the reading below 50 indicating the first contraction in manufacturing activity since February.

Economists had expected the index to show a much more modest decrease to a reading of 52.2, which would have still indicated growth in the sector.

Looking ahead, the monthly jobs report is likely to be in focus on Friday, overshadowing separate reports on international trade and factory orders.