Treasurys fall as Wall Street rallies
Government bond prices decline as the Dow posts triple-digit gains, and bank regulators don't offer much new information about stress tests.
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| Click the chart for current bond yields and prices. |
NEW YORK (CNNMoney.com) -- Treasurys prices fell Friday as Wall Street rallied, with the Dow Jones industrial average posting triple-digit gains.
U.S. stock indexes rose Friday on the back of some less negative than expected corporate results. In particular, Ford Motor (F, Fortune 500) said it lost $1.4 billion in the first quarter, but the loss was less severe than analysts were expecting.
A report on orders for big-ticket items such as computers and refrigerators showed that new U.S. orders for durable goods fell 0.8% in March, according to a report from the Commerce Department. The dip was less severe that economists were expecting.
And another report from the Commerce Department showed a slow down in the decline in the sales of newly constructed homes. New home sales fell 0.6% last month to a seasonally adjusted annual rate of 356,000, but that was from a rate of 358,000 in February, which was revised up from the originally reported 337,000.
Also affecting bond prices, the market was awaiting further details of the government's plan to assess the health of major banks, but regulators at the Federal Reserve did not release much in the way of new information Friday.
In an effort to determine which U.S. banks are healthy enough to withstand another financial shock, the Treasury Department has conducted so-called stress tests on 19 of the nation's largest banks. Official results will not be made public until May 4.
The market is also bracing for another big dose of supply. The Treasury Department said Thursday it plans to auction a total of $101 billion in 2-year, 5-year and 7-year notes next week.
At the same time, the Federal Reserve is set to buy more Treasurys Monday and Thursday as part of its campaign to buy $300 billion in U.S. debt.
By buying back government debt, the Fed hopes to drive down interest rates on consumer and business loans, such as mortgages, to help revive the economy.
Bond prices: The benchmark 10-year note was down 19/32 to 97 31/32, and its yield rose to 2.99% from 2.92% late Thursday. Bond prices and yields move in opposite directions.
The 30-year bond fell 1 15/32 to trade at 93 11/32, and its yield rose to 3.88% from 3.79%.
The 2-year note was down less 2/32 to 99 27/32, and its yield edged up to 0.97% from 0.94%.
The yield on the 3-month note was unchanged at 0.10%.
Meanwhile, lending rates were mixed. The 3-month Libor fell to 1.07% from 1.09% Thursday, according to Bloomberg.com. The overnight Libor was unchanged at 0.2%.
Libor, the London Interbank Offered Rate, is a daily average of rates that 16 different banks charge each other to lend money in London. 
