After ending last Friday’s trading modestly higher, treasuries showed a notable move back to the downside during trading on Monday.
Bond prices came under pressure over the course of morning trading and remained firmly negative throughout the afternoon. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, rose by 4.5 basis points to 1.792 percent.
With the significant increase on the day, the ten-year yield ended the session at its highest closing level in a month.
The weakness among treasuries came amid renewed optimism about the completion of phase one of a U.S.-China trade deal following comments from President Donald Trump and Chinese Vice Premier Liu He.
Trump said he thought an agreement would be signed by the time the Asia-Pacific Economic Cooperation meetings take place in Chile on November 16 and 17.
Meanwhile, Liu said that China and the United States would work to address each other’s core concerns on the basis of equality and mutual respect.
“China and the U.S. have made substantial progress in many aspects, and laid an important foundation for a phase one agreement,” Liu said at a tech conference on Saturday, according to Bloomberg News.
The strong corporate results reported last week also increased the appeal of riskier assets equities as earnings season gets into full swing in the coming days.
Trading on Tuesday may be impacted by reaction to a National Association of Realtors report on existing home sales in the month of September.
Bond traders are also likely to keep an eye on the results of the Treasury Department’s auction of $40 billion worth of two-year notes.