Treasuries Close Roughly Flat After Seeing Modest Strength

Treasuries saw modest strength for much of the trading session on Thursday before ending the day roughly flat.

Bond prices moved higher in morning trading before pulling back near the unchanged line in the afternoon. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, edged down by less than a basis point to 3.078 percent.

Bargain hunting contributed to the early strength among treasuries following the notable downward move seen over the two previous sessions.

Traders continued to shrug off concerns about the trade dispute between the U.S. and China, however, limiting the upside for treasuries.

JPMorgan Chase CEO Jamie Dimon sought to downplay the trade dispute in comments to CNBC-TV18, calling it a “trade skirmish” rather than a trade war.

Upbeat economic data may have contributed to the suggest pullback by treasuries, with a report from the Labor Department showing initial jobless claims unexpectedly dipped to their lowest level in nearly fifty years in the week ended September 15th.

The Labor Department said jobless claims edged down to 201,000, a decrease of 3,000 from the previous week’s unrevised level of 204,000. Economists had expected jobless claims to rise to 210,000.

With the unexpected decrease, jobless claims fell to their lowest level since hitting 197,000 in November of 1969.

A separate report from the Conference Board showed a continued increase by its index of leading economic indicators in the month of August.

The Conference Board said its leading economic index rose by 0.4 percent in August after climbing by an upwardly revised 0.7 percent in July.

“The leading indicators are consistent with a solid growth scenario in the second half of 2018 and at this stage of a maturing business cycle in the U.S., it doesn’t get much better than this,” said Ataman Ozyildirim, Director of Business Cycles and Growth Research at the Conference Board.

He added, “The strengths among the LEI’s components were very widespread, further supporting an outlook of above 3.0 percent growth for the remainder of 2018.”

Meanwhile, the National Association of Realtors released a report showing existing home sales were unexpectedly flat in August, with sales growth in the Northeast and Midwest offset by downturns in the South and West.

A quiet day on the U.S. economic front may keep some traders on the sidelines on Friday ahead of next week’s Federal Reserve meeting.

by RTTNews Staff Writer

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