July 8, 2013 / 8:13 PM / in 4 years

UPDATE 1-Speculators turned bearish on U.S. 10-year T-note futures-CFTC

July 8 (Reuters) - Speculators turned bearish on U.S. 10-year Treasury note futures last week before the government’s June payrolls report, according to Commodity Futures Trading Commission data released on Monday.

The latest monthly jobs reading, which the Labor Department reported on Friday, came in stronger than expected and caused a bond market selloff that lifted the yield on the benchmark U.S. 10-year Treasury note to its highest level in nearly two years.

The amount of bearish, or short, positions in 10-year Treasury futures from speculators exceeded bullish, or long, positions by 22,917 contracts on July 2, according to the CFTC’s latest Commitments of Traders data.

There were 33,011 more speculative long positions than speculative shorts in 10-year note futures the previous week. .

On Monday, 10-year T-note futures on the Chicago Board of Trade for September delivery closed 20/32 higher at 125-9/32, while the yield on cash 10-year Treasury notes fell 9 basis points to 2.643 percent after rising to 2.755 percent earlier, which was the highest intraday level since August 2011, according to Reuters data.

Speculators also trimmed bullish bets on five-year Treasury note futures last Tuesday, according to the latest weekly CFTC Commitments of Traders figures.

Their long trades in five-year Treasury note futures exceeded short positions by 125,475 contracts - 8,678 less than the previous week.

Speculators reduced their net short bets on short-dated and longer-dated T-note futures before the June jobs report.

Speculators’ long positions in two-year T-note futures exceeded their shorts by 14,308 contracts last Tuesday. A week earlier, they held 9,812 more shorts in two-year T-notes than longs.

They trimmed to their net shorts in 30-year bond futures by 9,295 contracts last Tuesday to 20,309.

The net shorts in ultra-long T-bond futures decreased by 673 contracts to 12,278 in the latest week.

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