Bond traders retreat to sidelines

10yearyieldmorning.pngClick chart for more bond and rate data. By Annalyn Censky, staff reporter


NEW YORK (CNNMoney.com) -- Treasuries turned around from Monday's rally, as investors shrugged off the latest housing data.

Prices on the 10-year note and 30-year bond fell slightly on weak demand, while shorter term notes, including the 2-year and the 5-year, inched up.

Traders were taking a wait-and-see stance as they awaited clarity on the Federal Reserve's plans.

Financial markets are already counting on a major announcement from the Fed in November -- launching a second large round of asset purchases, or so-called quantitative easing -- as a way to stimulate the economy.

Anticipating that a large government purchase would push Treasury yields down, investors have been trying to front-run the government's trade -- leading to a recent surge in bonds, said Kenneth Naehu, managing director and head of fixed income at Bel Air Investment Advisors.

But without any big buys from the government on Tuesday, Naehu said traders are waiting for other hints as to what Fed officials could decide at their next meeting in November.

The Fed bought $6.3 billion in Treasuries Monday and $4.7 billion last week, but didn't announce any purchases on Tuesday.

"Today, with the lack of government support in there, you could have buyers and sellers of Treasuries on the sidelines waiting," Naehu said.

This week, bond traders will also be closely watching more than a dozen speeches from Fed officials for more clues about monetary policy going forward.

At separate events on Tuesday, Atlanta Fed President Dennis Lockhart and Chicago Fed President Charles Evans -- both non-voting members of the Fed -- pushed for more quantitative easing.

Earlier on Tuesday, a reading on new home construction in September blew away expectations, however, building permits lagged behind.

What yields are doing: The yield on the benchmark 10-year note rose to 2.52%, from 2.51% Monday.

Yields for the 30-year bond inched up to 3.96%, from 3.94%. The 5-year note fell to 1.12%, and the 2-year note hit 0.37%.

Yields move in opposite directions of bond prices. To top of page

Just the hot list include
Frontline troops push for solar energy
The U.S. Marines are testing renewable energy technologies like solar to reduce costs and casualties associated with fossil fuels. Play
25 Best Places to find rich singles
Looking for Mr. or Ms. Moneybags? Hunt down the perfect mate in these wealthy cities, which are brimming with unattached professionals. More
Fun festivals: Twins to mustard to pirates!
You'll see double in Twinsburg, Ohio, and Ketchup lovers should beware in Middleton, WI. Here's some of the best and strangest town festivals. Play
Overnight Avg Rate Latest Change Last Week
30 yr fixed3.80%3.88%
15 yr fixed3.20%3.23%
5/1 ARM3.84%3.88%
30 yr refi3.82%3.93%
15 yr refi3.20%3.23%
Rate data provided
by Bankrate.com
View rates in your area
 
Find personalized 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%
Data as of 6:29am ET
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%
Data as of 2:44pm ET

Sections

Bankrupt toy retailer tells bankruptcy court it is looking at possibly reviving the Toys 'R' Us and Babies 'R' Us brands. More

Land O'Lakes CEO Beth Ford charts her career path, from her first job to becoming the first openly gay CEO at a Fortune 500 company in an interview with CNN's Boss Files. More

Most stock quote data provided by BATS. Market indices are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer. Morningstar: © 2018 Morningstar, Inc. All Rights Reserved. Factset: FactSet Research Systems Inc. 2018. All rights reserved. Chicago Mercantile Association: Certain market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. Dow Jones: The Dow Jones branded indices are proprietary to and are calculated, distributed and marketed by DJI Opco, a subsidiary of S&P Dow Jones Indices LLC and have been licensed for use to S&P Opco, LLC and CNN. Standard & Poor's and S&P are registered trademarks of Standard & Poor's Financial Services LLC and Dow Jones is a registered trademark of Dow Jones Trademark Holdings LLC. All content of the Dow Jones branded indices © S&P Dow Jones Indices LLC 2018 and/or its affiliates.