June 22, 2020 / 7:41 PM / 18 days ago

TREASURIES-Yields steady as traders await more COVID-19 data

 (New throughout, updates yields, market activity, comments)
    By Ross Kerber and Chuck Mikolajczak
    June 22 (Reuters) - U.S. Treasury yields were stable on
Monday, as investors awaited details on what a continuing
increase in COVID-19 cases could mean for the U.S. economy.
    The benchmark 10-year yield was up 1.1 basis
points in afternoon trading at 0.7102%. 
    The yield had fallen as low as 0.674% during the session but
moved higher as investors put money into riskier equities
instead of safe-haven Treasuries, deciding the pace of new case
disclosures could have been worse, said Gennadiy Goldberg,
interest rates strategist at TD Securities in New York.
    "The headlines today at least weren't quite as negative,
that is really what helped drive the turnaround in risk
sentiment," Goldberg said. 
    The death toll from the novel coronavirus reached over
120,000 in the United States, according to a Reuters tally.
After weeks of declining, infections nationally were rising
again with 12 states reporting record increases last week as all
states moved forward with reopening their economies.
    On Saturday, over 30,000 new cases were reported, the
highest daily total since May 1.
    Wall Street's three major indexes gained ground with the
biggest boost from technology stocks as investors appeared to
look past economic harm from the pandemic.
    U.S. home sales in May dropped to their lowest level in more
than 9-1/2 years, leading to worries of a sharp housing market
contraction in the second quarter.
    A closely watched part of the U.S. Treasury yield curve
measuring the gap between yields on two- and 10-year notes,
 seen as an indicator of economic expectations, was
at 51 basis points, about a basis point higher than on Friday's
close.
    The two-year  U.S. Treasury yield, which
typically moves in step with interest rate expectations, was up
less than a basis point at 0.1957% in afternoon trading.
      
      June 22 Monday 3:11PM New York / 1911 GMT
                               Price                  
 US T BONDS SEP0               177-4/32     -0-5/32   
 10YR TNotes SEP0              138-172/256  -0-28/25  
                                            6         
                               Price        Current   Net
                                            Yield %   Change
                                                      (bps)
 Three-month bills             0.1475       0.1496    -0.005
 Six-month bills               0.17         0.1725    -0.002
 Two-year note                 99-221/256   0.1957    0.008
 Three-year note               100-18/256   0.2263    0.008
 Five-year note                99-146/256   0.3378    0.011
 Seven-year note               99-184/256   0.5414    0.013
 10-year note                  99-48/256    0.7102    0.011
 20-year bond                  98-20/256    1.2342    0.002
 30-year bond                  94-184/256   1.4689    -0.001
                                                      
   DOLLAR SWAP SPREADS                                
                               Last (bps)   Net       
                                            Change    
                                            (bps)     
 U.S. 2-year dollar swap         5.75        -0.75    
 spread                                               
 U.S. 3-year dollar swap         4.00        -0.50    
 spread                                               
 U.S. 5-year dollar swap         3.50         0.00    
 spread                                               
 U.S. 10-year dollar swap       -2.00         0.50    
 spread                                               
 U.S. 30-year dollar swap      -49.50         0.50    
 spread                                               
                                                      
 
 (Reporting by Ross Kerber in Boston and by Chuck Mikolajczak in
New York. Editing by Nick Zieminski and David Gregorio)
  
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