Treasuries Regain Ground Following Last Week's Weakness

(RTTNews) - After showing a notable move to the downside last week, treasuries regained some ground over the course of the trading day on Monday.

Bond prices moved higher in morning trading and remained in positive territory throughout the afternoon. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, fell by 3 basis points to 2.976 percent.

With the drop on the day, the ten-year yield pulled back after ending last Friday's trading above 3 percent for the first time in well over two years.

The moderate rebound by treasuries was partly due to bargain hunting, with the high yields increasing the appeal of bonds.

Buying interest was also generated by a report from the National Association of Realtors showing a much smaller than expected increase in pending home sales in the month of November.

NAR said its pending home sales index inched up 0.2 percent to 101.7 in November from a downwardly revised 101.5 in October. Economists had been expecting the index to jump by about 1.5 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.

While activity may be somewhat subdued on Tuesday ahead of the New Year's Day holiday on Wednesday, trading could be impacted by the release of reports on home prices, consumer confidence, and Chicago-area business activity.