Treasuries Close Moderately Lower Following Manufacturing Data

(RTTNews) - Treasuries moved moderately lower during trading on Tuesday, extending the pullback seen over the two previous sessions.

Bond prices moved to the downside in early trading and remained stuck in the red throughout the day. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, rose by 3.6 basis points to 2.759 percent.

The weakness among treasuries was partly in reaction to a relatively upbeat reading on manufacturing activity in the month of March.

The Institute for Supply Management said its index of activity in the manufacturing sector crept up to 53.7 in March from 53.2 in February. A reading above 50 indicates growth in the sector.

The internals of the report were somewhat mixed. While the production and backlog of orders indices showed notable increases, the employment index saw a moderate decrease.

Peter Boockvar, managing director at the Lindsey Group, said, "Bottom line, some normality in the economy was reflected in the data but the headline figure is still 1 point below its 6-month average."

A separate report from the Commerce Department showed a modest uptick in construction spending in the month of February.

The report said construction spending inched up by 0.1 percent to a seasonally adjusted annual rate of $945.7 billion in February.

The modest increase matched economist estimates, but revised data showed that spending fell 0.2 percent to a rate of $944.6 billion in January.

Economic data may continue to impact trading on Wednesday, with ADP scheduled to release it report on private sector employment in the month of March.