(Bond Market Wrapup for November 26th, 2012) – Treasuries advanced for the first time in five days to reverse some of last week’s losses as investors remained skeptical over European policy makers’ ability to cut deals in time that will clear a plan to release aid payments to Greece.
The 10-year benchmark yield dropped from a two-week high after pro-independence parties won a majority in Catalonia, strengthening the demand for referendum on secession. Euro area finance ministers met in Brussels for the second time in less than a week to discuss a three-year mission that will put Greece on the financial recovery path.
Yield on 10-year Treasury notes dropped 2 basis points, or 0.02 percentage point, to 1.67 percent while yield on 30-year Treasury bonds also slipped two basis points to 2.81 percent in late afternoon trade, New York time.
Bond funds traded mixed with the iShares Barclays 20 Year Treasury Bond ETF (TLT) adding 59 cents, or 0.48 percent, to end at $124.80, while the Vanguard Total Bond Market ETF (BND) shed 2 cents, or 0.02 percent to close at $84.73.
US stocks finished mixed Monday with the S&P 500 ending a five-day winning streak in the first full trading day since last Wednesday as investors grew cautious ahead of budget negotiations in Washington while keeping an eye on the results of the start of the holiday shopping season.
The Dow Jones Industrial Average (DJIA) finished 42.31 points, or 0.33 percent, lower at 12,967.37, paring an early 109-point decline after White House Press Secretary Jay Carney said the impasse over budget negotiations will be broken soon. Breadth within the blue-chip index turned negative with 23 of the 30 components finishing lower.
UnitedHealth Group Inc (UNH) led the decliners, slipping 0.7 percent on the day after the health insurer’s 2013 earnings guidance fell short of analysts’ expectations.
After logging a 3.6 percent gain, the S&P 500 Index (SPX) fell 2.86 points, or 0.2 percent, to 1406.29 with energy and telecom sliding the most and technology and utilities pacing the gains among its 10 business groups.
The tech-heavy NASDAQ Composite Index (COMP) managed to buck the trend Monday, adding 9.93 points, or 0.33 percent, to close at 2976.78. Facebook (FB) surged 8.1 percent while Apple Inc rallied 3.2 percent as tech stocks bounced back on Cyber Monday.
For every four stocks declining, three advanced on the NYSE.
Oil prices for January delivery fell 54 cents to close at $87.74 a barrel.
Gold futures for December delivery eased $1.80 to finish at $1,749.60 an ounce.