Ten-Year Yield Jumps To One-Month Higher Following Upbeat Economic Data

(RTTNews) - Treasuries showed a notable move to the downside during trading on Wednesday, more than offsetting the increase seen in the previous session.

Bond prices came under pressure in morning trading and remained firmly negative throughout the afternoon. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, jumped 6.8 basis points to 4.157 percent.

The ten-year yield more than offset the 1.7 basis point dip seen on Tuesday, reaching its highest closing level in a month.

The weakness among treasuries came in reaction to some upbeat U.S. economic data, including a report from payroll processor ADP showing private sector employment in the U.S. rebounded by more than expected in the month of October.

ADP said private sector employment climbed by 42,000 jobs in October after slipping by a revised 29,000 jobs in September.

Economists had expected private sector employment to rise by 25,000 jobs compared to the loss of 32,000 jobs originally reported for the previous month.

The Institute for Supply Management also released a report showing U.S. service sector activity returned to expansion in the month of October.

The ISM said its services PMI climbed to 52.4 in October after falling to 50.0 in September, with a reading above 50 indicating growth. Economists had expected the index to inch up to 50.8.

With the bigger than expected increase, the services PMI reached its highest level since hitting 53.5 in February.

The upbeat data reduced bonds' safe-haven appeal, although the Federal Reserve is still seen as likely to lower interest rates by another quarter point next month.