UPDATE 1-Speculators add U.S. 10-year T-notes after Bernanke-CFTC

Fri Jun 28, 2013 4:20pm EDT

June 28 (Reuters) - Speculators raised U.S. 10-year Treasury note futures holdings in the latest week after Federal Reserve Chairman Ben Bernanke offered a blueprint on how the U.S. central bank might trim its bond purchases this year if the economy continues to improve, according to Commodity Futures Trading Commission data released on Friday.

Bernanke's remarks on June 19 about possibly less Fed stimulus roiled financial markets worldwide. In the bond market, Treasury yields jumped to near two-year highs on Monday before retreating a bit.

Markets stabilized this week, partly due to comments from other Fed officials, which analysts say were aimed to assure investors the central bank will keep short-term interest rates near zero even well after it stops buying bonds, which is currently at a monthly pace of $85 billion.

Analysts also attributed the mild increase in speculative longs to buying in a bid to close short positions.

The amount of bullish, or long, positions in 10-year Treasury futures from speculators exceeded bearish, or short, positions by 33,011 contracts on June 25.

There were 31,229 speculative net longs in 10-year note futures a week ago.

On Friday, 10-year T-note futures on the Chicago Board of Trade for September delivery closed down 5/32 at 126-14/32, while the yield on cash 10-year Treasury notes ended up nearly 2 basis points to 2.491 percent, which was below its 22-month high of 2.667 percent set on Monday according to Reuters data.

The U.S. Treasuries market finished the day on down note, marking its worst quarter in 2-1/2 years.

Speculators also raised bullish bets on five-year Treasury note futures, even after five-year debt suffered its worst weekly loss in about four years the previous week, according to the latest weekly CFTC Commitments of Traders figures.

Their long trades in five-year Treasury note futures exceeded short positions by 134,153 contracts, up 73,814 from the prior week.

The net shorts in ultra-long T-bond futures shrank by 15,044 contracts to 12,951 in the latest week.

On the other hand, speculators added to their net shorts in 30-year bond futures by 29,328 contracts on Tuesday to 29,604.

Speculators' short positions in two-year T-note futures exceeded their longs by 9,812 contracts on Tuesday. A week earlier, they held 25,489 more longs in two-year T-notes than shorts.

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