Treasuries Close Nearly Flat For Second Straight Day

(RTTNews) - Treasuries showed a lack of direction throughout the trading day on Wednesday before closing roughly flat for the second straight session.

Bond prices spent the day bouncing back and forth across the unchanged line. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, inched up by less than a basis point to 2.35 percent.

The second consecutive choppy trading day in the bond market came following the release of a mixed batch of U.S. economic data.

Payroll processor ADP released a report early in the day showing stronger than expected private sector job growth in the month of October.

ADP said the private sector added 230,000 jobs in October following an upwardly revised increase of 225,000 jobs in September. Economists had expected private sector employment to increase by about 220,000 jobs.

However, a separate report from the Institute for Supply Management showed a notable slowdown in the pace of growth in service sector activity.

The ISM said its non-manufacturing index dropped to 57.1 in October from 58.6 in September. While a reading above 50 indicates continued growth in the service sector, economists had expected the index to show a more modest drop to 58.0.

With the bigger than expected decrease, the non-manufacturing index fell to its lowest level since hitting 56.0 in June.

Traders were also digesting the outcome of yesterday's midterm elections, which saw Republicans expand their majority in the House and retake control of the Senate.

Republican candidates won a number of key races and will hold at least 52 Senate seats beginning in January, with the Alaska and Louisiana seats also potentially going to the GOP.

Paul Dales, Senior U.S. Economist at Capital Economics, said the Republican majorities could kick start progress on some trade and energy policies but argued that the election results "don't alter the economic landscape much."

Another batch of economic data could impact trading on Thursday, with traders likely to keep an eye on reports on weekly jobless claims and labor productivity. The latest monetary policy decision in Europe is also likely to attract attention.