Treasuries Pull Back Sharply Following Slew Of Economic Data

After moving sharply higher over the two previous sessions, treasuries showed a substantial move back to the downside during trading on Thursday.

Bond prices moved steadily lower throughout much of the trading day before closing firmly negative. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, spiked 14.1 basis points to 2.828 percent.

The ten-year yield more than offset the 9.3 basis point drop seen over the two previous sessions, reaching its highest closing level since December 2018.

The sharp pullback by treasuries came following the release of a slew of U.S. economic data, including a report from the Commerce Department showing U.S. retail sales increased in March amid a spike in sales by gas stations.

The report showed retail sales rose by 0.5 percent in March after climbing by an upwardly revised 0.8 percent in February.

Economists had expected retail sales to increase by 0.6 percent compared to the 0.3 percent uptick originally reported for the previous month.

Excluding a pullback in sales by motor vehicle and parts dealers, retail sales jumped by 1.1 percent in March after rising by 0.6 percent in February. Ex-auto sales were expected to increase by 1.0 percent.

A separate report released by the Labor Department showed first-time claims for U.S. unemployment benefits increased by more than expected in the week ended April 9th.

The Labor Department said initial jobless claims rose to 185,000, an increase of 18,000 from the previous week’s revised level of 167,000.

Economists had expected initial jobless claims to edge up to 171,000 from the 166,000 originally reported for the previous week.

The Labor Department also released a report showing U.S. import prices surged by more than expected in the month of March, as prices for fuel imports continued to skyrocket.

Meanwhile, preliminary data released by the University of Michigan unexpectedly showed a substantial improvement in U.S. consumer sentiment in the month of April.

The report showed the consumer sentiment index spiked to 65.7 in April from 59.4 in March. The sharp increase surprised economists, who had expected the index to edge down to 59.0.

The consumer sentiment index rebounded from its lowest level since August 2011 amid an improvement in consumer expectations, with the expectations index surging to 64.1 in April from 54.3 in Mach.

While the markets will be closed on Friday, the Federal Reserve is still scheduled to release its report on industrial production in the month of March.

Following the long weekend, traders are likely to keep an eye on reports on homebuilder confidence, housing starts, and existing home sales as well as the Fed’s Beige Book.

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