Treasuries Move Back To The Upside Ahead Of Jobs Report

(RTTNews) - After ending the previous session modestly lower, treasuries moved back to the upside over the course of the trading day on Thursday.

Bond prices moved higher early in the session and remained positive throughout the day. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, fell by 3.4 basis points to 2.228 percent.

The higher close by treasuries came even traders looked ahead to the release of the Labor Department's closely watched monthly jobs report on Friday.

The report is expected to show employment climbed by 183,000 jobs in July, while the unemployment rate is expected to dip to 4.3 percent.

A report released by the Labor Department this morning showed a modest decrease in first-time claims for unemployment benefits in the week ended July 29th.

The report said initial jobless claims dipped to 240,000, a decrease of 5,000 from the previous week's revised level of 245,000. Economists had expected jobless claims to edge down to 242,000.

The Institute for Supply Management released a separate report showing a notable slowdown in the pace of service sector growth in the month of July.

The ISM said its non-manufacturing index dropped to 53.9 in July from 57.4 in June, although a reading above 50 still indicates growth in the service sector. Economists had expected the index to dip to 57.0.

Meanwhile, the Commerce Department released a report showing a substantial increase in factory orders in the month of June.

Overseas, the Bank of England kept its record low interest rate unchanged in a split vote, as expected, and maintained the size of monetary stimulus.

The Monetary Policy Committee, headed by Governor Mark Carney, voted 6 to 2 to keep the interest rate at an historic low of 0.25 percent.

The bank downgraded its economic growth projections for 2017 to 1.7 percent from 1.9 percent and for 2018 to 1.6 percent from 1.7 percent. The outlook for 2019 was maintained at 1.8 percent.

Trading on Friday is likely to be impacted by reaction to the Labor Department's employment report for the month of July.

The Commerce Department is also scheduled to release its report on international trade in June. The trade deficit is expected to narrow to $45.0 billion.