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TREASURIES-Bonds firm in Asia as shares hit by profit concerns
April 18, 2013 / 5:31 AM / 5 years ago

TREASURIES-Bonds firm in Asia as shares hit by profit concerns

TOKYO, April 18 (Reuters) - U.S. Treasuries firmed in Asia on Thursday, bringing the benchmark yield near a four-month low, as profit concerns hit Wall Street shares in a market already rattled by sinking commodity prices.

* The yield on the benchmark 10-year notes dipped about 1 basis point to 1.686 percent, just a stone throw from Wednesday’s intraday low of 1.673 percent, which was its lowest in over four months.

* A catalyst for buying in bonds was a broad selloff in U.S. shares. Standard & Poor’s 500 Index and the Nasdaq Composite Index fell more than 1 percent, with Apple Inc falling 5.5 percent after one of its key suppliers gave a disappointing revenue forecast.

* Treasuries were also helped by comments from European Central Bank Governing Council member Jens Weidmann that Europe’s economic recovery could take as much as another decade and that the ECB may cut rates if the economy weakens.

* “We have had a series of disappointing U.S. data, starting from the ISM manufacturing index to employment and retail sales. If the economic data continues to disappoint, the 10-year yield could head to 1.6 percent,” said Shinichiro Kadota, strategist at Barclays.

* As these weak numbers fanned expectations the Federal Reserve will keep the pace of its bond buying unchanged at $85 billion for now, investors are looking to the Philadelphia Fed’s factory activity index due at 1400 GMT.

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