Treasury gains mild as durables drop shrugged off
Fri Feb 24, 2006 9:29 AM ET
NEW YORK, Feb 24 (Reuters) - U.S. Treasury debt prices ticked up on Friday after a report showing a sharp drop in durable goods orders for January.
But gains were meager as signs of underlying strength in the orders left traders thinking the Federal Reserve would keep raising interest rates.
Overall, durable goods orders plunged a startling 10.2 percent in January, surprising economists who forecast a 1 percent drop, the Commerce Department said.
But outside transportation, orders rose 0.6 percent, slightly more than economists had expected. Non-defense capital goods orders excluding aircraft, edged down 0.4 percent.
"Aircraft is responsible for a lot of that decline," said Anthony Chan, chief economist at J.P. Morgan Private Client Services. "My suspicion is that the manufacturing sector will ease up, but the manufacturing recovery is still in place."
With that in mind, benchmark 10-year notes <US10YT=RR> were trading just 2/32 higher for a yield of 4.55 percent, down from 4.56 percent Thursday.
Bonds had also garnered a modest bid from reports of a blast at a Saudi oil refinery, although Saudi security officials had since said they had actually foiled a suicide bombing attack.
Five-year notes <US5YT=RR> were yielding 4.62 percent, having garnered 4.622 percent at Thursday's rather poorly received auction.
The 30-year bond <US30YT=RR> was up 6/32 and yielding 4.49 percent, while two-year notes <US2YT=RR> were up marginally for a yield of 4.71 percent.
All in all, the market was trading in a narrow range -- albeit at higher yield levels than a month ago.
Since January, the market has gone from thinking there was a good chance the Fed might stop raising rates after its March meeting to pricing in an ever increasing chance of another move in May.
That would carry the target federal funds rate for overnight lending to 5.0 percent from the current 4.50 percent.
The market would be turning its attention later in the day to a speech from Fed Chairman Ben Bernanke, although traders would probably wait to read about it on weekend newspapers since it would only take place at 5:30 p.m. (2230 GMT).
scadono anche le opzioni marzo per cui speriamo diportare definitivamente a casa qualche premio di call , sempre che sti pazzi non facciano uno spike di 2-3 figure 
praticamente non viaggio più su cavi ethernet. 
