Treasuries Close Lower Following Lackluster Session
Treasuries showed a lack of direction during trading on Friday before eventually ending the session moderately lower.
Bond prices moved to the downside in afternoon trading and spending the morning bouncing back and forth across the unchanged line. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, rose by 2 basis points to 0.642 percent.
The lower close by treasuries came after report from the Institute for Supply Management manufacturing activity continued to contract in the month of April but the decline was not as bad as feared.
The ISM said its purchasing managers index slumped to 41.5 in April from 49.1 in March, with a reading below 50 indicating a contraction in manufacturing activity.
The manufacturing index showed a notable decrease compared to the previous month but still came in above economist estimates for a reading of 36.9.
With the decline, the purchasing managers index dropped to its lowest level since hitting 39.9 in April of 2009.
Meanwhile, a separate report released by the Commerce Department showed an unexpected increase in construction spending in the month of March.
The Commerce Department said construction spending climbed by 0.9 percent to an annual rate of $1.361 trillion in March after tumbling by 2.5 percent to a revised $1.348 trillion in February.
The increase came as a surprise to economists, who had expected construction spending to plunge by 3.5 percent compared to the 1.3 percent slump originally reported for the previous month.
Next week’s trading may be impacted by reaction to the Labor Department’s monthly jobs report as well as reports on the U.S. trade deficit, service sector activity, and private sector employment.