Even amid thin trading volumes, U.S. data out on Christmas Eve is having an effect on U.S. Treasuries and has prompted a general rise in bond prices.
Initial claims for unemployment benefits in the United States pushed towards near record highs with 586k people filing for benefits for the week ending Dec. 20, the Department of Labor reported. Initial jobless claims were forecast to fall back to 558k.
Furthermore, durable goods orders excluding transportation posted a gain in November of 1.2% despite forecasts for a 3.0% decline. Total new orders fell by 1.0% against expectations of a 3.0% loss.
Thirty-year future contracts are currently flat at 141-00 during the session, but ticked up on the data from 140-31.5 levels. Benchmark 10-year futures are meanwhile up 7.5 ticks to 127-12 from 17-05.5 levels.
At the belly of the curve, five-year futures are up 3.5 ticks to 119-15.5 after rising from 119-14.5 levels.
Two-year futures are up 2.5 ticks to 108-25.5 during the session. They had been at 108-26.5 levels at the time of the release of the data at 8:30 a.m. EST.
RBS Greenwich Capital's Ian Lyngen wrote that he isn't expecting much market activity ahead of the holidays.
"As the last meaningful event of the day, we look for a slow grind into the holiday with the market little changed-to-slightly higher on the data/session¥ Overall flows extremely light -- a theme we expect will continue into the early close," he wrote in reaction to the data releases.
In other U.S. data, total personal spending, which comprises roughly 70% of U.S. gross domestic product, came in 0.6% lower for November, following a cutback of 1.0% in October. Annually, spending has risen just 0.5%, compared to 2.3% in the prior report.
The personal income category was cut back 0.2% in the month, against the consensus expectation for a flat reading, and following a 0.1% rise in October. Annually, incomes have risen 2.5%, compared with a 3.3% reported gain in the October report.
March Eurodollar contracts are currently up 0.5 ticks to 98.755.
All data taken at 8:59 a.m. EST.
By Ryan Szporer
©CEP News Ltd. 2008