NEW YORK (CNNMoney.com) -- Treasury yields recovered losses Friday, gaining momentum as stocks rallied and a better-than-expected manufacturing report eased economic jitters.
What yields are doing: The yield on the benchmark 10-year note rose to 2.6% from 2.55% late Thursday. Bond prices and yields move in opposite directions.
The yield on the 30-year bond edged up to 3.79% from 3.73%, and the 5-year note climbed to 1.35% from 1.31%. The 2-year note's yield ticked up to 0.45% from 0.42% on Thursday.
What's moving the market: Durable goods orders, a measure of manufacturing, slipped 1.3% in August after falling 0.7% in July, the government reported Friday.
While that was only slightly better than the 1.4% drop economists had forecast, the report also showed that orders excluding transportation climbed 2%, beating forecasts of a slight 0.6% rise.
Stocks spiked following the report, reducing the appeal of safe haven Treasurys and driving yields higher.
"We're seeing some evidence beginning to emerge that the economy may have actually stopped falling and that we're beginning to level off at a very modest growth rate," said Peter Cardillo, a chief market strategist at Avalon Partners.
The evidence was much needed because earlier this week the Federal Reserve expressed concern about deflation and a slowing recovery, saying that it is willing to take additional steps to support the economy if necessary.
Those steps could include buying Treasurys outright -- a practice known as quantitative easing -- if the economic recovery stalls. That goes a step further than the central bank's previously announced plan to reinvest proceeds from its portfolio into Treasurys.
"They didn't say they were going to actually do it, they said they were thinking about it," said Cardillo. "So now the question is do they pull the trigger and if so, when do they pull the trigger?"
To gauge when -- and if -- the trigger will be pulled, traders will be scrutinizing economic data released in the weeks leading up to the Fed's next policy meeting, which begins Nov. 2.
"If economic numbers continue to come in a little better, the Fed may stay on the sidelines longer," said Cardillo. "And if it does stay on the sidelines, we could see a sell-off in Treasurys and see yields pop up."
Overnight Avg Rate | Latest | Change | Last Week |
---|---|---|---|
30 yr fixed | 3.80% | 3.88% | |
15 yr fixed | 3.20% | 3.23% | |
5/1 ARM | 3.84% | 3.88% | |
30 yr refi | 3.82% | 3.93% | |
15 yr refi | 3.20% | 3.23% |
Today's featured rates:
Index | Last | Change | % Change |
---|---|---|---|
Dow | 32,627.97 | -234.33 | -0.71% |
Nasdaq | 13,215.24 | 99.07 | 0.76% |
S&P 500 | 3,913.10 | -2.36 | -0.06% |
Treasuries | 1.73 | 0.00 | 0.12% |
Company | Price | Change | % Change |
---|---|---|---|
Ford Motor Co | 8.29 | 0.05 | 0.61% |
Advanced Micro Devic... | 54.59 | 0.70 | 1.30% |
Cisco Systems Inc | 47.49 | -2.44 | -4.89% |
General Electric Co | 13.00 | -0.16 | -1.22% |
Kraft Heinz Co | 27.84 | -2.20 | -7.32% |
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