Treasury Yields Fall Below 200 DMA, US stocks end week lower

(March 23rd, 2012) Treasuries rose for the fourth straight day as uncertainty over the country’s economic recovery raised the safe-haven appeal of US debt. Investors remained edgy about the recovery of the economy as latest new-home sales data indicated further trouble ahead for housing.

Treasuries advanced for the fourth day, their longest winning streak in nearly a month. Yields on 30-year bonds fell below their 200-day moving average indicating an end to the six-month high reached earlier in the month. The spread between 10-year Treasuries and TIPS narrowed. Yield on 10-year notes dropped 5 basis points to 2.23 percent while 30-year bond yields also shed 0.05 percentage points to end the week at 3.31 percent, below their 200-day moving average of 3.3343 percent.

The iShares Barclays 20 Year Treasury Bond ETF (TLT) rose 1.06 points, or 0.95 percent, for the day, while the Vanguard Total Bond Market ETF (BND) gained 0.15 points, or 0.18 percent over Thursday’s close.

US stocks closed higher Friday, narrowing weekly losses as a weak dollar and a spike in oil prices boosted commodities related stocks.

The Dow Jones Industrial Average (DJIA) added 44.77 points, or 0.3 percent, to 13,090.83, shaving weekly losses and ending a three-day losing streak. The Dow is down 1.1 percent on the week, though it has gained 7 percent since the start of 2012. Oil giant Chevron (CVX) and heavy-equipment manufacturer Caterpillar Inc (CAT) drove the index’s gains today.

The S&P 500 Index (SPX) rose 5.31 points, or 0.4 percent, to 1398.09 with oil stocks adding 1.1 percent. Oil stocks, along with miners and chemical firms led today’s gains. Nabors Industries jumped 4.5 percent.

The tech-heavy NASDAQ Composite (COMP) rose a modest 4.72 points, or 0.2 percent, to close at 3068.07 for the week.

Trading was choppy on the NYSE following mixed housing report and China and European growth worries. Home builders KB Homes (KBH) lost more than 8 percent while other major homebuilders Lennar (LEN), PulteGroup (PHM) and Toll Brothers (TOL) also took a hit.

Oil future for May delivery gained 1.4 percent, or $1.52 to close at $106.87 a barrel.

Gold futures for April delivery jumped $19.90 to end at $1,662.40 an ounce.

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