Bonds retreat in face of strong stock outlook |
| Reuters - Jul 25, 2007 |
.S. Treasury debt prices fell on Wednesday, pulling benchmark yields back from seven-week lows as investors geared up for a stock market rebound in the wake of Tuesday's slide.
S&P 500 (SPc1: Quote, Profile, Research) and other stock index futures pointed to a strong opening on Wall Street, luring money away from safe-haven bonds. Also, the government will auction two-year notes later in the session, and the fresh supply could press bond prices lower.
The main potential positive for Treasuries appeard to be the existing home sales data that is due at 10 a.m. (1400 GMT). This has the potential to limit the bond market's losses if it heightens worries about the troubled housing sector, which punished stocks and lifted Treasuries on Tuesday.
For now, though, bond traders were focused squarely on the buoyant stock futures.
"With S&Ps up, people are selling Treasuries," said Thomas di Galoma, head of U.S. Treasury trading at Jefferies & Co. in New York.
In early New York action, prices on the benchmark 10-year note slid 8/32 on the day, pushing yields up to 4.94 percent from 4.91 percent on Tuesday. In earlier offshore trade, gains had pushed the yield down as far as 4.90 percent, its lowest since the start of June.
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- Posted: 2007-07-25 12:52:30
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