TREASURIES-Bonds turn lower as stocks cut losses

NEW YORK, May 16 (Reuters) - U.S. government debt prices turned lower in afternoon trade as stocks erased a majority of their losses and Treasuries ran into technical resistance.

Bonds, which rose early on a sharp drop in consumer sentiment reported for the first half of May, sank into the minus column as stocks shaved losses. The Dow Jones industrial average .DJI which was down 86 points shortly after midday, was down just 16 points in midafternoon trade.

"Stocks did turn around and Treasuries stalled out," said John Spinello, fixed-income strategist at Jefferies & Co in New York. "People who had pretty good profits from the last few days were ready to sell."

Treasury yields also ran into "what was perceived to be resistance" at 3.78 percent on 10-year yields and 3.03 percent on five-year yields, Spinello said.

The benchmark 10-year Treasury note's price, which moves inversely to its yield <US10YT=RR>, was down 6/32 for a yield of 3.85 percent after being up 7/32 earlier to yield 3.79 percent. The 10-year note yielded 3.82 percent late Thursday.

The two-year Treasury note's price was unchanged, its yield at 2.45 percent, compared with 2.42 percent <US2YT=RR> earlier in the session and 2.43 percent late Thursday. (Reporting by Ellen Freilich; Editing by Jonathan Oatis)