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Treasuries fall with euro debt before trade data
Wed Jul 12, 2006
By Richard Leong
NEW YORK, July 12 (Reuters) - U.S. Treasury debt prices fell on Wednesday in line with euro zone debt issues as traders took profits and unwound safe haven positions spurred by Tuesday's deadly train explosions in Mumbai, India.
The Treasury market also is expected to draw support from equities. U.S. tech shares may come under pressure after European Union regulators fined Microsoft Corp. (MSFT.O: Quote, Profile, Research) for breaching a 2004 antitrust ruling, traders said.
"It's an winding of the rally yesterday," Dominic Konstam, global head of interest rate strategy at Credit Suisse in New York. "We don't have much of a follow-through from the overnight session."
Traders also will digest the latest reading on the U.S. trade picture due 8:30 a.m. (1230 GMT), which analysts expect to worsen after several months of unexpected improvement.
The median forecast of the U.S. trade deficit in May was $64.90 billion, wider than with April's $63.43 billion.
Greater net imports of foreign goods would cut into overall U.S. economic growth in the second quarter.
Two-year Treasury notes <US2YT=RR> dipped 1/32 in price to yield 5.18 percent, up 2 basis points from late Tuesday.
Benchmark 10-year notes <US10YT=RR> fell 6/32 in price to yield 5.13 percent, a day after posting their lowest level in nearly four weeks.
The U.S.'s financial imbalances also have shown signs of turning around. On Tuesday, the Bush Administration lowered its fiscal 2006 budget deficit forecast by $127 billion to $296 billion as a result of higher-than-expected tax receipts.
Meanwhile, the U.S. housing market signaled resilience in light of rising mortgage rates.
The Mortgage Bankers Association said its index of mortgage application activities for the week ended July 7 rose 1 percent from the prior week to 566.8, its highest level in three weeks.
At 10:30 a.m. (1430 GMT), the Senate Banking Committee will hold a hearing on the nomination of Frederic Mishkin to be a member of the Federal Reserve Board of Governors. The 55-year-old professor served as research director at the New York Fed from 1994 to 1997.
Wed Jul 12, 2006
By Richard Leong
NEW YORK, July 12 (Reuters) - U.S. Treasury debt prices fell on Wednesday in line with euro zone debt issues as traders took profits and unwound safe haven positions spurred by Tuesday's deadly train explosions in Mumbai, India.
The Treasury market also is expected to draw support from equities. U.S. tech shares may come under pressure after European Union regulators fined Microsoft Corp. (MSFT.O: Quote, Profile, Research) for breaching a 2004 antitrust ruling, traders said.
"It's an winding of the rally yesterday," Dominic Konstam, global head of interest rate strategy at Credit Suisse in New York. "We don't have much of a follow-through from the overnight session."
Traders also will digest the latest reading on the U.S. trade picture due 8:30 a.m. (1230 GMT), which analysts expect to worsen after several months of unexpected improvement.
The median forecast of the U.S. trade deficit in May was $64.90 billion, wider than with April's $63.43 billion.
Greater net imports of foreign goods would cut into overall U.S. economic growth in the second quarter.
Two-year Treasury notes <US2YT=RR> dipped 1/32 in price to yield 5.18 percent, up 2 basis points from late Tuesday.
Benchmark 10-year notes <US10YT=RR> fell 6/32 in price to yield 5.13 percent, a day after posting their lowest level in nearly four weeks.
The U.S.'s financial imbalances also have shown signs of turning around. On Tuesday, the Bush Administration lowered its fiscal 2006 budget deficit forecast by $127 billion to $296 billion as a result of higher-than-expected tax receipts.
Meanwhile, the U.S. housing market signaled resilience in light of rising mortgage rates.
The Mortgage Bankers Association said its index of mortgage application activities for the week ended July 7 rose 1 percent from the prior week to 566.8, its highest level in three weeks.
At 10:30 a.m. (1430 GMT), the Senate Banking Committee will hold a hearing on the nomination of Frederic Mishkin to be a member of the Federal Reserve Board of Governors. The 55-year-old professor served as research director at the New York Fed from 1994 to 1997.
