Treasuries Give Back Ground Following Recent Strength

(RTTNews) - After moving sharply higher over the past few sessions, treasuries saw a notable pullback over the course of the trading day on Friday.

Bond prices came under pressure in early trading and saw some further downside as the day progressed. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, jumped 10.4 basis points to 1.748 percent.

With the increase on the day, the ten-year yield regained some ground after ending the previous session at its lowest closing level in a year.

The pullback by treasuries was partly due to a sharp increase by the price of crude oil, with crude for March delivery soaring $3.23 to $29.44 a barrel on optimism about possible production cuts.

Amid ongoing oversupply concerns, the price of crude oil tumbled $1.24 in the previous session to a nearly thirteen-year closing low of $26.21 a barrel.

The substantial rebound by the price of crude oil contributed to a rally on Wall Street, which also weighed on treasuries.

Traders were also reacting to a report from the Commerce Department showing that U.S. retail sales rose slightly more than expected in January.

The Commerce Department said retail sales climbed by 0.2 percent in January compared to economist estimates for a 0.1 percent uptick.

The report also showed that retail sales in December rose by an upwardly revised 0.2 percent compared to the 0.1 percent drop initially reported.

Core retail sales, which exclude autos, gasoline, and building materials, increased by 0.6 percent in January following a 0.3 percent decrease in December.

Meanwhile, a separate report from the University of Michigan showed an unexpected deterioration in consumer sentiment in the month of February.

The report said the preliminary reading on the consumer sentiment index for February came in at 90.7 compared to the final January reading of 92.0. The index had been expected to inch up to 92.5.

Following the holiday weekend, next week's trading may be impacted by reports on housing starts, industrial production, and producer and consumer price inflation.

The Federal Reserve is also scheduled to release the minutes of its latest monetary policy meeting, which could shed some light on the outlook for interest rates.