Treasuries Extend Yesterday's Pullback Following Upbeat Jobs Data

(RTTNews) - Treasuries came under pressure during trading on Friday, extending the notable downward move seen over the course of the previous session.

Bond prices slumped early in the session and saw further downside as the day progressed. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, jumped 9.1 basis points to 4.322 percent.

The extended pullback by treasuries came following the release of a closely watched Labor Department report showing U.S. job growth far exceeded economist estimates in the month of April.

The Labor Department said non-farm payroll employment shot up by 177,000 jobs in April compared to expectations for an increase of about 130,000 jobs.

At the same time, the jumps in employment in February and March were downwardly revised to 102,000 jobs and 185,000 jobs, respectively, reflecting a net downward revision of 58,000 jobs.

The report also said the unemployment rate came in at 4.2 percent in April, unchanged from the previous month and in line with economist estimates.

Indications China is open to trade talks with the U.S. also reduced the safe haven appeal of bonds, with a spokesperson for China's Ministry of Commerce saying U.S. officials have "repeatedly expressed their willingness to negotiate with China on tariffs."

The spokesperson said China is "currently evaluating" messages sent to China through relevant parties hoping to start trade talks.

However, according to a Google translation, the spokesperson said the U.S. has to be prepared to "correct its wrong practices" and cancel unilateral tariffs if it wants to talk and warned failure to do so would show the U.S. has "no sincerity at all and will further damage the mutual trust between the two sides."

The Federal Reserve's latest interest rate decision is likely to be in focus next week along with reports on service sector activity and the U.S. trade deficit as well as any developments on the trade front.