After seeing early strength, treasuries gave back ground over the course of the session on Thursday but managed to close modestly higher.
Bond prices ended the day in positive territory but well off their best levels of the day. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, edged down by 1.8 basis points to 2.042 percent.
With the modest decrease on the day, the ten-year yield still ended the session at its lowest closing level in five months.
The modestly higher close by treasuries partly reflected uncertainty ahead of the release of tomorrow’s closely watched monthly jobs report.
The Labor Department report is expected to show an increase of about 203,000 jobs in September following the addition of 173,000 jobs in August.
The jobs data could have a significant impact on expectations regarding whether the Federal Reserve will raise interest rates later this month.
Earlier today, the Labor Department released a report showing that initial jobless claims rose by more than expected in the week ended September 26th.
The report said initial jobless claims climbed to 277,000, an increase of 10,000 from the previous week’s unrevised level of 267,000. Economists had expected jobless claims to edge up to 271,000.
The Institute for Supply Management also released a separate report showing that its reading on activity in the manufacturing sector fell to a two-year low in September.
The ISM said its purchasing managers index dropped to 50.2 in September from 51.1 in August, although a reading above 50 indicates growth in the sector. Economists had expected the index to dip to 50.5.
With the bigger than expected decrease, the manufacturing index fell to its lowest level since hitting 50.1 in May of 2013.
Meanwhile, the Commerce Department released a report showing that construction spending rose slightly more than expected in August amid a jump in spending on residential construction.
The monthly jobs report is likely to be in the spotlight on Friday, although traders are also likely to keep an eye on remarks by a number of Fed officials.
The material has been provided by InstaForex Company – www.instaforex.com