Government Bond Prices Finish Fourth Week of Losses
September 21 2018 - 5:20PM
Dow Jones News
By Gunjan Banerji
U.S. government bond prices rose Friday but still capped off a
fourth week of declines as investors turned to riskier assets like
stocks ahead of next week's Federal Reserve meeting.
The yield on the 10-year Treasury fell to 3.068% Friday from
3.076% Thursday. Yields rise as bond prices fall.
Yields rose in the beginning of the week, reaching the highest
levels in months as investors assessed a growing supply of
corporate and government bonds and a solid U.S. economic
outlook.
Treasury yields then pared some of their gains on Thursday as
the prospect of higher returns ignited new demand, according to
some analysts. Investors bought both U.S. stocks and government
bonds on Friday, with major stock indexes hovering near highs, the
latest sign of continuing investor optimism about the U.S.
economy.
Geopolitical concerns helped curtailed some of the selling in
Treasurys this week. British Prime Minister Theresa May warned
Friday that Brexit talks had hit a logjam, calling on European
leaders to propound new proposals.
The Brexit situation marked a "warning beacon that things are
still happening below the surface even though stock markets are in
a state of reasonable euphoria," said Jim Vogel, an interest-rates
strategist at FTN Financial.
Investors will be closely watching the Federal Reserve meeting
next week, where many expect the central bank to raise interest
rates. The yield on the two-year Treasury note, which tends to be
more sensitive to the path of interest rates, hit the highest mark
in over a decade this week.
Analysts are also closely tracking talks between the U.S. and
China on trade. Easing trade frictions have helped spur yield gains
in recent sessions, pushing investors toward riskier assets.
Write to Gunjan Banerji at Gunjan.Banerji@wsj.com
(END) Dow Jones Newswires
September 21, 2018 17:05 ET (21:05 GMT)
Copyright (c) 2018 Dow Jones & Company, Inc.