U.S. bond edged lower Thursday as investors awaited weekly data on jobless benefit claims and geared up for Friday’s July jobs report, after the Treasury market took a wild ride in the previous session.
What are yields doing?
The yield on the 10-year Treasury note
was at 1.17%, compared with 1.183% at 3 p.m. Eastern on Wednesday. Yields and debt prices move in opposite directions.
The 2-year Treasury note yield
was at 0.184% versus 0.182% Wednesday afternoon.
The 30-year Treasury bond yield
declined to 1.822% from 1.84% late Wednesday.
What’s driving the market?
Treasury yields traded in a wide range Wednesday, sliding after a weaker-than-expected read on July private-sector payrolls then bouncing back after a stronger-than-expected reading on service-sector activity from the Institution for Supply Management.
Jobs data remain in focus, with weekly figures on applications for unemployment benefits due at 8:30 a.m. Eastern. Economists look for first-time jobless claims to show a decline to 385,000 in the week ended July 31 from 400,000 the previous week.
On Friday, the July jobs report from the U.S. Labor Department is expected to show the U.S. economy added 845,000 jobs, while the unemployment rate is expected to decline to 5.7% from 5.9%.
What are analysts saying?
On the positive side, “the 10-year yield bounced off the 1.13% level (which seems to be support) and clearly the 10-year can react to better-than-expected data,” said Tom Essaye, founder of the Sevens Report, in a note. “Negatively, there remain aggressive buyers on Treasury dips and it’s going to take a real, impactful headline to break this negative technical momentum tum in bonds.”
Candidates to provide that spark include the jobs report on Friday, if it comes in “too hot,” he said. A peak and sharp fall in COVID cases, upcoming inflation data and remarks coming out of the Federal Resreve symposium in Jackson Hole, Wyoming, later this month are also potential catalysts.