NEW YORK (CNNMoney) -- Treasury prices dropped Wednesday after two employment reports sparked hopes that stagnant unemployment might finally be easing.
Before the opening bell, outplacement firm Challenger Gray & Christmas reported that planned job cuts fell 59% to 530,000 in 2010, the lowest level in 13 years.
Meanwhile, private sector payrolls soared by 297,000 in December, according to a separate report from payroll processor ADP. Economists surveyed by Briefing.com were expecting the report to show that payrolls increase by 100,000 last month, compared to November's 93,000 rise.
Those reports sent Treasury prices lower, and yields higher, as investors fled safe-haven assets for riskier investments. Bond yields and prices move in opposite directions.
Stocks failed to mount a substantial rally following the reports, but managed to climb higher in the afternoon.
The lack of response in morning trading suggests that many investors are waiting for the government's monthly jobs report to be released on Friday.
Economists surveyed by CNNMoney expect the monthly report to show employers boosted payrolls by 146,000 last month, after adding 39,000 jobs in November.
"Friday's employment number could be the 'watershed' event the economy needs to jumpstart confidence and entice Americans to come off their wallets and spend," said Kevin Giddis, managing director of fixed income at Morgan Keegan in a research note.
If more Americans can find work, the momentum might snowball.
"Jobs and housing are the biggest variables and if you can solve for one, you might get the other, albeit over time, not overnight," Giddis said.
Jobs numbers aren't the only positive economic indicators for traders to consider in morning trading.
After the opening bell, a report from the Institute of Supply Management showed that activity in the service sector picked up last month. The index rose to 57.1 in December, topping forecasts and up from 55 in November.
What yields are doing: The yield on the benchmark U.S. Treasury 10-year note increased to 3.47% after closing at 3.33% on Tuesday.
The yield on the 30-year bond climbed to 4.54%, while the 2-year note's yield ticked up to 0.71%. The yield on the 5-year note rose slightly to 2.14%.
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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