Treasuries Close Slightly Higher Ahead Of Holiday Weekend

(RTTNews) - After ending the previous session roughly flat, treasuries showed a modest move to the upside during trading on Friday.

Bond prices moved higher in early trading and managed to remain positive throughout the session. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, edged down by 1 basis point to 2.543 percent.

The uptick by treasuries came amid a relatively quiet trading day, with many traders away from their desks ahead of the holiday weekend.

On the U.S. economic front, the Commerce Department released a report showing a much bigger than expected increase in new home sales in the U.S. in the month of November.

The report said new home sales surged up by 5.2 percent to an annual rate of 592,000 in November from 563,000 in October. Economists had expected new home sales to rise by 3 percent to a rate of 580,000.

A separate report from the University of Michigan said consumer sentiment improved by even more than initially estimated in the month of December.

The University of Michigan said its consumer sentiment index for December was upwardly revised to 98.2 from the preliminary reading of 98.0.

Economists had expected the index to remain at 98.0, which was still well above the final November reading of 93.8.

With the unexpected upward revision, the consumer sentiment index reached its highest levels since January of 2004.

Following the long Christmas weekend, next week's trading may remain somewhat subdued ahead of another three-day weekend in celebration of New Year's Day.

Nonetheless, traders are likely to keep an eye on reports on consumer confidence, pending home sales, and Chicago-area business activity.

Bond trading could also be impacted by reaction to the results of the Treasury Department's auctions of two-year, five-year, and seven-year notes.

The Treasury said its plans to auction $26 billion worth of two-year notes next Tuesday, $34 billion worth of five-year notes next Wednesday, and $28 billion worth of seven-year notes next Thursday.