Treasuries Close Roughly Flat Following Choppy Trading Day

(RTTNews) - After ending the previous session sharply lower, treasuries showed a lack of direction throughout the trading day on Thursday before closing roughly flat.

Bond prices spent the day bouncing back and forth across the unchanged line. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, ended the day up by less than a basis point at 2.775 percent.

The choppy trading came as traders seemed reluctant to make any significant moves following the pullback seen late in the previous session.

Traders were likely continuing to digest new Federal Reserve Chair Janet Yellen's remarks at a press conference following the central bank's monetary policy meeting on Wednesday.

In a move that surprised traders, Yellen indicated that the Fed could begin raising interest rates six months after ending its asset purchase program.

With the Fed currently expected to wrap up its asset purchases by the end of this year, her remarks suggest that the central bank will begin raising rates in mid-2015.

While the mid-2015 guidance is in line with the forecasts by many economists, traders seemed to react to the reality that rates will not remain low forever.

The lackluster performance on Thursday came despite the release of several U.S. economic reports, including a report from the Conference Board showing a bigger than expected increased by its index of leading economic indicators.

The report said the leading economic index rose by 0.5 percent in February after edging up by 0.1 percent in January. Economists had expected the index to rise by 0.3 percent.

Ataman Ozyildirim, an economist at the Conference Board, said, "The U.S. LEI increased sharply in February, suggesting that any weather-related volatility will be short lived and the economy should continue to improve into the second half of the year."

A separate report from the Philadelphia Reserve also suggested a return to growth in March following weather-related weakness in February.

The Philly Fed said its diffusion index of current activity jumped to a positive 9.0 in March from a negative 6.3 in February. A positive reading indicates an increase in regional manufacturing activity.

Meanwhile, the National Association of Realtors released a report showing a modest drop in existing home sales in February. The drop matched economist estimates.

The Labor Department also released a report before the start of trading showing a modest rebound in initial jobless claims in the week ended March 15th.

Trading activity may remain somewhat subdued on Friday, as there are no major U.S. economic reports scheduled to be released.