By Deborah Levine, MarketWatch
NEW YORK (MarketWatch) — Treasury prices rose Friday, pushing yields down from near seven-month highs, as traders increasingly expect a meeting of European leaders to be disappointing, leaving risk revolving around sovereign debt around to spook investors in the new year.
Yields on 10-year notes (UST10Y 3.40, -0.03, -0.96%) , which move in the opposite direction as prices, fell 6 basis points to 3.38%. A basis point is one one-hundredth of a percentage point.
Analysts also noted that the 10-year yield has hit some key technical levels that may limit a continued selloff, as they signal an oversold asset.
Yields on 2-year notes (UST2YR 0.64, -0.01, -1.08%) declined by 1 basis point to 0.65%.
Thirty-year bond yields (UST30Y 4.52, -0.03, -0.57%) fell 3 basis points to 4.51%.
Worries about debt in Europe has tended to fuel investors’ demand for the relative security and liquidity of Treasury bonds.
Also, “Moody’s downgrading Ireland five notches and reviewing the credit of Greece and Belgium for a possible downgrade have kept the bid in Treasurys,” said Thomas di Galoma, head of U.S. fixed-income trading for Guggenheim Securities.
Later in the session, the U.S. government’s index of leading indicators will be released. On Thursday, Treasurys came under pressure after a trio of economic reports showed improvement in jobless claims, manufacturing and housing. Read Thursday’s Bond Report.
The final scheduled event of the day will be the Federal Reserve’s latest buyback of Treasury bonds.
The Fed said it expects to buy $1.5 billion to $2.5 billion of debt maturing from 2028 through 2040. See Fed’s buyback schedule.
