TREASURIES-Prices turn flat as Wall Street hits session highs

NEW YORK Dec 20 (Reuters) - U.S. Treasuries prices turned flat, paring earlier gains mid-afternoon Thursday, as Wall Street stocks climbed to session highs on revived optimism about a coming budget deal that will avert a U.S. fiscal crisis, which curbed some bids for bonds.

Benchmark 10-year Treasury notes were up 1/32 in price with a yield of 1.803 percent. Earlier, they were up 11/32 with a yield 1.767 percent, down 4 basis points from late on Wednesday.

The three major U.S. stock indexes were higher with the Standard & Poor's 500 up 0.4 percent.