JGBs largely down, underpinned by volatile stocks

TOKYO: Most Japanese government bonds edged down on Thursday, while superlong maturities came off their highs after a 30-year bond sale.

An afternoon selloff in Japanese stocks underpinned bond market sentiment and kept losses in check.

The benchmark 10-year cash JGB yield was up half a basis point at 0.025 percent, while the 10-year JGB futures contract ended down 0.04 point at 150.95.

The 30-year JGB yield was flat at 0.800 percent, after sinking to as low as 0.785 percent earlier in the session. The 40-year JGB yield was down 1.5 basis points at 0.970 percent, above its session low of 0.950 percent.

The Ministry of Finance offered 800 billion yen of 30-year JGBs with a 0.80 percent coupon, with 3.4180 percent of the bids accepted at the lowest price of 100.0685.

The sale drew bids of 3.43 times the amount offered, indicating decent demand but was still down from the previous sale's bid-to-cover ratio of 3.98.

Data released early in the session showed Japan's core machinery orders tumbled at their fastest pace in more than two years in September, a decline that companies expect to persist into October-December.

The Bank of Japan's nine-member board debated calls from one of its policymakers to target the longer end of the yield curve at a rate review in October, a summary of their opinions showed on Thursday, with several stressing that the current stimulus was sufficient.

At the October rate review, the BOJ held monetary policy steady by a 8-1 vote, with board newcomer Goushi Kataoka dissenting. Kataoka also called for the BOJ to guide 15-year bond yields below 0.2 percent through its bond purchases.