$42 Billion Poured into US 10-Year Treasury Bonds 'Box Office Flop'

Rising Government Bond Yields... New York Stock Market Reverses to Decline

The U.S. Treasury's bond auction ended in a lackluster performance.

On the 7th (local time), the U.S. Treasury conducted an auction for $42 billion worth of 10-year Treasury bonds. The auction yield was set at 3.96%, which was 0.03 percentage points higher than traders' expectations.

The bid-to-cover ratio from primary dealers who absorb the remaining bonds was 17.9%, higher than the recent average. A high primary dealer ratio indicates weak demand for Treasury bonds.

Due to weak demand for U.S. Treasuries, bond yields are rising. According to Tradeweb, the yield on the 10-year U.S. Treasury note, a global bond yield benchmark, jumped from 3.887% the previous day to 3.96% on the day.

The New York stock market, which started higher that day, also reversed to a decline. As of 3:06 p.m. Eastern Time, the Dow Jones Industrial Average was down 0.31% compared to the previous trading day, while the S&P 500 and Nasdaq indices were down 0.13% and 0.2%, respectively.