Tuesday, 17 April 2012 20:59
NEW YORK: US Treasuries prices retreated on Tuesday as US stock market gains and a better-than-expected bid for a Spanish short-term debt auction curbed the bid for safe-haven US government debt.
US Treasuries prices rose on Monday when the euro zone crisis seemed to heat up after the yield on Spain's key 10-year debt rose to a five month high above 6 percent, a level seen as unsustainable.
But on Tuesday, a good reception for a Spanish debt auction spelled relief. Spain sold a more-than-planned 3.2 billion euros ($4.2 billion) of 12- and 18-month bills, drawing good demand from domestic banks. Yields rose sharply as expected.
The result knocked safe-haven German Bunds off their highs and sent US debt prices lower.
The better auction results encouraged a risk on trade and US stocks advanced, aided by corporate earnings results.
But losses in the Treasury market were modest. Nervousness remains ahead of a longer-term Spanish bond ...