US Treasury yields fall as stocks struggle to hold onto gains

  • In the previous session, U.S. government debt prices had risen sharply, as investors fled to safe-haven bonds as the sell-off in global equities continued.
  • The Treasury Department auctioned $26 billion in 3-year notes at a high yield of 2.28 percent. The bid-to-cover ratio, an indicator of demand, was 3.

U.S. government debt yields fell Tuesday afternoon as U.S. stocks struggled to hold onto gains in volatile trading.

The yield on the benchmark 10-year Treasury note fell to 2.756 percent at 2:39 p.m. ET, while the yield on the 30-year Treasury bond was higher at 3.031 percent. Bond yields move inversely to prices.

Symbol
Yield
 
Change
%Change
US 3-MO
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US 1-YR
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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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Tuesday proved to be another day for markets, with volatility sending stocks fluctuating throughout the session. Bond prices fell for most of the morning as traders cautiously moved back into equities after Monday's big sell-off, with the Dow Jones industrial average touching a high of 360 points.

Those gains were pared as uncertainty fears resurfaced with popular bets against the VIX — the market's best fear gauge — losing the majority of their value. The sell-off kicked into action on Friday, after the latest nonfarm payrolls report saw interest rates on U.S. sovereign debt jump.

While there was no particular piece of news that pushed major U.S. indexes into the red on Monday and Tuesday, the recent moves in the bond market have added volatility and concern to market sentiment.

Consequently, investors are paying close attention to not only the bond market, but how the U.S. Federal Reserve will react to this, as Jerome Powell takes on the position as chair of the U.S. central bank.

The Treasury Department auctioned $26 billion in 3-year notes at a high yield of 2.28 percent. The bid-to-cover ratio, an indicator of demand, was 3. Indirect bidders, which include major central banks, were awarded 49.8 percent. Direct bidders, which includes domestic money managers, bought 9.7 percent.

In Japan, Bank of Japan Governor Haruhiko Kuroda ruled out the possibility of lifting rates in the near future, according to Reuters. Meantime, the Reserve Bank of Australia held fire on changing its monetary policy stance, delivering an upbeat message on the economy on Tuesday.