From the Financial Times:
US Treasuries broke a winning streak on Thursday, succumbing to profit-taking that helped nudge the yield on the 10-year note back over 4 per cent.
The 10-year yield broke below the psychologically important 4 per cent level for the first time in five months on Wednesday, and opened below that level on Thursday. Traders said it headed higher after failing to break through technical resistance at 3.96 per cent. Following the rise in Treasury prices over the past few days, observers said many participants were also over-extended and that some selling could be related to position-trimming.
Strategists said news that the US was considering lending some of its strategic petroleum reserve to cover hurricane-related problems in the Gulf of Mexico also helped weaken bonds.
At midday in New York, movements were concentrated in longer-dated bonds, and the yield on the two-year note was little changed at 2.462 per cent. The 10-year yield was at 4.007, up 2.3 basis points on the day, while that on the 30-year bond added 2bp to 4.794 per cent.
Technoflak has never heard of lending the strategic petroleum reserve.