Treasuries Give Back Ground Amid News Of Trade Talks

(RTTNews) - Treasuries saw modest weakness during trading on Thursday, giving back ground following the strong upward move seen in the previous session.

Bond prices moved to the downside in morning trading and remained stuck in the red throughout the afternoon. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, rose by 1.9 basis points to 2.871 percent.

The increase by the ten-year yield came after the 4.3 basis point drop in the previous session pulled the yield down to its lowest closing level in almost a month.

The pullback by treasuries came as stocks on Wall Street rallied following news China has accepted an invitation from the U.S. for a new round of trade talks to be held in late August.

China's Ministry of Commerce said that a Chinese delegation led by Vice Commerce Minister Wang Shouwen will travel to the U.S. for trade talks to be held with U.S. Under Secretary of Treasury for International Affairs David Malpass.

In an interview with CNBC, White House economic advisor Larry Kudlow confirmed the U.S. and China will resume trade talks later this month.

On the U.S. economic front, the Labor Department released a report showing first-time claims for unemployment benefits unexpectedly edged lower in the week ended August 11th.

The report said initial jobless claims dipped to 212,000, a decrease of 2,000 from the previous week's revised level of 214,000.

Economists had expected jobless claims to inch up to 215,000 from the 213,000 originally reported for the previous week.

Meanwhile, a separate report from the Commerce Department showed new residential construction rebounded by much less than expected in the month of July.

The report said housing starts rose by 0.9 percent to an annual rate of 1.168 million in July after plunging by 12.9 percent to a revised rate of 1.158 million in June.

Economists had expected housing starts to soar by 7.4 percent to an annual rate of 1.260 million from the 1.173 million originally reported for the previous month.

The Commerce Department also said building permits climbed by 1.5 percent to an annual rate of 1.311 million in July after dipping by 0.7 percent to a revised rate of 1.292 million in June.

Building permits, an indicator of future housing demand, had been expected to jump by 2.9 percent to a rate of 1.310 million from the 1.273 million originally reported for the previous month.

Following the slew of economic data released over the past two days, trading on Friday may be impacted by reaction to reports on consumer sentiment and leading economic indicators.