(Bond Market Recap for August 15th, 2012) Treasuries snapped a three-day winning streak, pushing yields up to near three month highs after a report showed US industrial production in July increased more than anticipated.
The benchmark 10-year Treasury yield climbed seven basis points, or 0.07 percentage point, to 1.80 percent amid mixed economic data. A Federal Bank of New York report said its manufacturing index has slipped into the negative terrain for the first time since October ahead of the opening bell. However, a separate Federal Reserve report said the nation’s industrial production expanded at a faster rate of 0.6 percent in July. Yield on 30-year treasury bonds rose nine basis points to 2.91 percent in late afternoon trading, new York time.
10 Year Treasury Yield – 1 Month Chart
Bond Funds were also down on the day with the 20 Year Treasury Bond ETF (TLT) shedding $1.74, or 1.41 percent, to end at $122.05, while the Vanguard Total Bond Market ETF (BND) lost 30 cents, or 0.36 percent to end at $84.18.
TLT 1 Month Chart
US stocks changed little Wednesday as investors sifted through mixed economic data even though blue-chips slipped over worries on further monetary stimulus measures from the Federal Reserve. After trading in a 55-point range, the Dow Jones Industrial Average (DJIA) closed 7.36 points, or less than 0.1 percent, lower at 13,164.78. Within the Dow however, 16 components out of 30 finished higher, led by Cisco (CSCO), Bank of America (BAC) and United Technologies (UTX). Intel (INTC) and Merck (MRK) were among the biggest percentage decliners, falling about 0.8 percent each.
Dow Jones Industrial Average 1 Month Chart
The S&P 500 Index (SPX) added 1.6 points, or 0.1 percent, to close at 1405.53, despite opening lower. Consumer discretionary and financials led the gainers among its 10 business groups. The tech-heavy NASDAQ Composite Index (COMP) rose 13.95 points, or 0.5 percent, to close at 3030.93 with Microsoft (MSFT) and Amazon (AMZN) outperforming and heavyweights Apple Inc (AAPL) and Google (GOOG) closing lower.
- Advancing stocks outpaced decliners 1.7-to-1 on the NYSE.
- Oil prices for August delivery gained 90 cents to $94.33 a barrel.
- Gold futures for December delivery rose $4.20 to $1,606.60 an ounce.