10-year yield hits record low (again!)

@CNNMoneyInvest May 31, 2012: 1:33 PM ET
U.S. Treasuries

Click chart for more bonds and rates

NEW YORK (CNNMoney) -- Investors continued to seek safety in U.S. Treasuries Thursday, further pushing the yield on 10-year notes to a fresh record low.

The yield dropped to 1.58% Thursday, down from from Wednesday's record low close of 1.62%. Investors have been flocking to bonds in both the U.S. and overseas as Europe's debt crisis and a slowing U.S. economy has investors on edge.

Disappointing reports on the U.S. labor market and ongoing worries about Europe prompted Thursday's flight to safety.

Initial jobless claims rose more than expected in the latest week, while a report on private sector hiring from payroll services firm ADP showed fewer-than-expected jobs were added in May. Also on Thursday the Commerce Department revised the U.S. gross domestic product figure for the first quarter to 1.9% from 2.2%.

The weak domestic economic news, coupled with mounting worries over problems in Spain's banking sector, led to further toward momentum in Treasury yields. Investors flock toward the security of government-backed Treasuries in times of uncertainty. The demand pushes bond prices up, forcing yields to fall.

"In addition to the fear that's still driving worries over Europe, the less-than-spectacular U.S. economic data today makes people more worried about the employment situation report coming out tomorrow," said David Coard, head of fixed income trading at the Williams Capital Group. "Couple seeing those weak numbers with the flight to quality bid being generated by Europe and you see how the markets have gone crazy."

Positive news out of Europe or strong economic data tomorrow could stop yields from slipping further, Coard said.

"The bond market players and investors in general would need to see more that things are fine to be convinced," he said. "If we get news that makes people more comfortable, people will start taking more risks and treasuries will fade."

That may come Friday, when the U.S. Labor Department releases its monthly jobs figures for May.

Analysts surveyed by CNNMoney expect that the U.S. economy added 150,000 jobs in May, including 12,000 government cuts. The unemployment rate is expected to stay at 8.1%.  To top of page

Index Last Change % Change
Dow 17,098.45 18.88 0.11%
Nasdaq 4,580.27 22.58 0.50%
S&P 500 2,003.37 6.63 0.33%
Treasuries 2.34 0.01 0.39%
Data as of 6:03am ET
Company Price Change % Change
Bank of America Corp... 16.09 0.08 0.50%
Apple Inc 102.50 0.25 0.24%
Intel Corp 34.92 0.27 0.78%
Facebook Inc 74.82 0.96 1.31%
General Electric Co 25.98 -0.03 -0.12%
Data as of Aug 29
Overnight Avg Rate Latest Change Last Week
30 yr fixed4.07%4.28%
15 yr fixed3.18%3.26%
5/1 ARM3.36%3.43%
30 yr refi4.05%4.21%
15 yr refi3.17%3.18%
Rate data provided
by Bankrate.com
View rates in your area
 
Find personalized rates:
Market indexes are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer Morningstar: © 2014 Morningstar, Inc. All Rights Reserved. Disclaimer The Dow Jones IndexesSM are proprietary to and distributed by Dow Jones & Company, Inc. and have been licensed for use. All content of the Dow Jones IndexesSM © 2014 is proprietary to Dow Jones & Company, Inc. Chicago Mercantile Association. The market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. FactSet Research Systems Inc. 2014. All rights reserved. Most stock quote data provided by BATS.