Treasuries turned in a lackluster performance during trading on Monday but managed to end the session slightly higher.
Bond prices spent much of the day in positive territory, but buying interest remained subdued. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, edged down by nearly a basis point to 2.218 percent.
The modestly higher close by treasuries came following the release of some disappointing economic data, including a report from MNI Indicators showing an unexpected contraction in Chicago-area business activity in November.
The report said the Chicago Business Barometer tumbled to 48.7 in November from 56.2 in October, with a reading below 50 indicating a contraction in regional business activity. Economists had expected the index to drop to 54.0.
MNI Indicators said the sharp drop by the business barometer is indicative of the see-saw pattern of demand seen in 2015, with output and orders shifting in and out of contraction.
The National Association of Realtors released a separate report showing a smaller than expected rebound in pending home sales in October.
NAR said its pending home sales index inched up by 0.2 percent to 107.7 in October from an upwardly revised 107.5 in September. Economists had expected the index to climb by 1.0 percent.
A pending home sale is one in which a contract was signed but not yet closed. Normally, it takes four to six weeks to close a contracted sale.
Nonetheless, trading activity remained somewhat subdued as traders looked to key events in the coming days, including the release of the Labor Department’s monthly jobs report on Friday.
The jobs report, which is expected to show an increase of about 190,000 jobs in November, could have a significant impact on the outlook for interest rates.
Reports on manufacturing and service sector activity, private sector employment and international trade are also likely to attract some attention.
Federal Reserve Chair Janet Yellen is also scheduled to deliver two speeches this week, joining several other Fed officials that are due to give remarks.
Additionally, the European Central Bank is scheduled to hold a monetary policy meeting on Thursday, with many expecting the bank to provide further stimulus.
Trading on Tuesday may be impacted by reaction to a report on national manufacturing activity as well as a report on construction spending.
The material has been provided by InstaForex Company – www.instaforex.com