Treasuries See Further Upside Amid Weakness On Wall Street

(RTTNews) - Treasuries moved to the upside during trading on Wednesday, extending the rally that was seen in the previous session.

Bond prices moved steadily higher as the day progressed before closing firmly in positive territory. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, fell by 3.6 basis points to 1.509 percent.

The higher close by treasuries came amid a pullback by stocks on Wall Street, which moved lower along with the price of crude oil.

Crude for September delivery tumbled $1.06 to $41.71 a barrel following the release of a report from the Energy Information Administration showing an increase in crude oil inventories in the week ended August 5th.

Treasuries saw continued strength even after a the Treasury Department's auction of $23 billion worth of ten-year notes attracted below average demand.

The ten-year note auction drew a high yield of 1.503 percent and a bid-to-cover ratio of 2.43, while the ten previous ten-year note auctions had an average bid-to-cover ratio of 2.61.

The bid-to-cover ratio is a measure of demand that indicates the amount of bids for each dollar worth of securities being sold.

On Thursday, the Treasury is due to finish off this week's long-term securities auctions with the sale of $15 billion worth of thirty-year bonds.

Trading on Thursday could also be impacted by reaction to reports on weekly jobless claims and import and export prices.