SINGAPORE Dec 20 U.S. 10-year Treasuries edged
higher in Asia on Thursday as talks to avoid the U.S. "fiscal
crisis" stalled and equities sagged, prompting traders to buy
back bonds in the wake of a two-week sell-off.
* Ten-year notes rose about 5/32 in price to yield 1.787
percent, down roughly 1 basis point from late U.S.
trade on Wednesday.
The 10-year yield had hit a high of 1.847 percent on
Tuesday, its highest level in about two months. That marked a
rise of about 28 basis points from a trough of 1.564 percent hit
on Dec. 6.
* "Bonds have become pretty cheap, and that seems to be
causing some short-covering," said a trader for a U.S. brokerage
in Tokyo, adding that a dip in equities was also probably
helping to trigger such position squaring in Treasuries.
* In the stock market, S&P 500 index futures and
MSCI's broadest index of Asia-Pacific shares outside Japan
were both down about 0.2 percent.
* Treasuries had come under pressure earlier this week
partly due to signs of progress in talks aimed at avoiding the
U.S. "fiscal cliff" of steep tax increases and spending cuts due
to take effect early next year.
Hopes for a deal to avoid the "fiscal cliff", which could
badly damage the economy, had helped support equities and
weighed on Treasuries.
The talks have since stalled, and President Barack Obama and
House of Representatives Speaker John Boehner are locked in
intense bargaining as a year-end deadline nears.