Treasuries decline

NEW YORK (CNNMoney.com) -- After a one-day respite, Treasury prices fell Tuesday.

Investors sent bond prices higher on Monday, following a successful $35 billion auction of two-year notes. But Treasuries dipped back into the red as investors weighed a continued drop in home prices, slipping consumer confidence and another bond auction on Tuesday.

The yield on the benchmark 10-year note rose to 3.48%. The 30-year bond yield was up to 4.55%.

Meanwhile, the yield on the 2-year note edged up to 0.68%. The 5-year note bounded to 2.15%. Treasury prices and yields move in opposite directions.

The Treasury Department issued a new slate of two-year notes Monday, worth a total of $35 billion. It was surprisingly successful, with about three-times as much investment interest as there were bonds to sell. That could bode well for bonds this week, analysts say.

Bond analysts note that participation in end-of-year bond auctions typically falls by about seven or eight percentage points. The Treasury plans on auctioning off a total of $99 billion worth of long-term government notes this week.

The Case-Shiller 20-City index of home prices in major metropolitan areas for October showed that prices fell 1.3% from a month earlier, an annualized decline of 15%. Economists had expected just a 0.2% decline after the previous month's 0.6% gain.

Also Tuesday, the Conference Board released a reading on consumer confidence for December, showing consumers were increasingly worried about spending. The index ticked down to 52.5 from 54.3 in November. It was expected to have risen to 56.1.

Trading desks continued to be lightly staffed during the holiday season. Both stock and bond trading has been relatively muted recently. Treasuries have essentially been in a downward trend all December.