Bonds round-up: US housing data hits bonds
Better than expected US housing data and resurgent equity markets had government bonds on the back foot today.
Sales of existing homes in the US fell 0.4% in January to an annualised 4.89m from a revised 4.91m in December. Economists had been expecting a fall of around 1.8%.
US treasuries retreated, pushing up the yield on the benchmark 10-year note to 3.86%, up 5 basis points, as this week's $42bn sale of two and five year treasury notes also acted as a drag on demand.
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Reports that bond insurer Ambac Financial will seek to dig itself out of a hole through a rights issue and through a $500m debt issue boosted equities today and further undermined the appeal of government debt, both in the US and on the other side of the Atlantic.
In Europe, government bonds followed their American counterparts lower, with the yield on the benchmark 10-year bund rising 3 basis points to 4.03% while the yield on the benchmark 10-year gilt climbed 4 basis points to 4.73%.
