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US bonds choppy after strong auction, amid stock climb

U.S. sovereign bonds were choppy Wednesday, as oil prices and global stocks continued to rally and the Treasury Department saw strong demand at a five-year note auction.

The benchmark 10-year Treasury note yield dipped to 1.862 percent on Wednesday, while the yield on 30-year bonds climbed to 2.655 percent. Two-year yields fell to 0.914 percent. U.S. five-year note yields rose to 1.401 percent.

Yields move inversely to bond prices. They had broadly risen earlier in the day.

Symbol
Yield
 
Change
US 3-MO
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US 2-YR
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US 5-YR
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US 10-YR
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US 30-YR
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The Treasury Department on Wednesday sold $34 billion in five-year notes at a high yield of 1.395 percent.

The bid-to-cover ratio, an indicator of demand, was 2.6, the strongest since November 2014 and higher than a recent average of 2.44.

Indirect bidders, which include major central banks, were awarded 66.6 percent, versus a recent average of 59 percent. Direct bidders, which include domestic money managers, bought 11.6 percent, compared with a recent average of 8 percent.

WTI and Brent crude futures traded above $49 per barrel on Wednesday, up slightly. European and U.S. stock indexes gained.

St. Louis Federal Reserve President James Bullard said labor market data suggested it was time for the Fed to raise interest rates again, in an interview with CNBC.


On the data front, U.S. weekly mortgage applications rose 2.3 percent. Weekly crude inventories are also scheduled for release Wednesday.

Euro zone finance ministers agreed a "breakthrough" deal for Greece early on Wednesday, after Athens committed to further austerity and reform measures over the weekend.