(Bond Market Wrapup for November 15th, 2012) – Treasury 10-year yields fell for the sixth day, the longest stretch of declines since September, ahead of President Obama’s Friday meeting with lawmakers to avoid confrontation over tax hikes and spending cuts that may push the US into recession, popularly known as the fiscal cliff. The benchmark 10-year yield traded in the tightest range in six weeks after rising earlier as a Labor Department report showed 439,000 Americans filed for jobless benefits last week, a big jump of 78,000 that was attributed to Hurricane Sandy.
A separate report showed manufacturing shrank in November in the New York region as the storm hit power supply and curbed activity. The Federal Reserve Bank of Philadelphia’s monthly manufacturing survey for November also showed a drop in activity.
10-year yields fell one basis point, or 0.01 percentage point, to 1.58 percent while yield on 30-year Treasury bonds dropped one basis point to 2.72 percent in late afternoon trade, New York time.
Bond funds were mostly down with the iShares Barclays 20 Year Treasury Bond ETF (TLT) dropping 25 cents, or 0.20 percent, to $126.48, while the Vanguard Total Bond Market ETF (BND) lost 0.01 cent, or 0.01 percent, to end at $84.99.
Major US equity averages continued with their losing streak Thursday as investors weighed negative data on employment and manufacturing activity.
The Dow Jones Industrial Average (DJIA) shed 28.57 points, or 0.2 percent, to 12,542.38, posting its fourth straight down session. The blue-chip index had slipped as much as 0.6 percent during the day’s trade, but pared losses in the final hour of trading. Breadth continued to trade negative with decliners outpacing winners 16 to 14, led by retail giant Wal-Mart Stores Inc (WMT). The world’s biggest retailer fell 3.6 percent after third quarter earnings beat estimates, but revenue fell short of expectations.
The S&P 500 Index (SPX) dropped 2.17 points, or 0.2 percent, to 1353.32 with telecommunications lagging the most. 8 of the 10 major business sectors finished the day lower.
NetApp Inc (NTAP) surged more than 11 percent after the data-storage firm’s second quarter earnings beat street estimates.
The tech-heavy NASDAQ Composite Index (COMP) lost 9.87 points, or 0.4 percent, to close at 2836.94, extending losses into the fourth straight session.
Decliners outpaced advancers 2-to-1 on the NYSE.
Oil prices for December delivery fell 87 cents to $85.45 a barrel.
Gold futures for December delivery dropped $16.30 to $1,713.80 an ounce.