Reply #70: Safe-haven frenzy drives US bonds higher [View All]

[Ghost Dog]

NEW YORK, May 14 (Reuters) - U.S. government bonds rallied on Friday, sending 10-year notes up a point in price as persistent worries over the euro zone's debt crisis led investors to ditch stocks for the safer harbor of Treasuries.

The bond market shrugged off data showing a bigger-than-expected rise in April U.S. retail sales, focusing instead on the slumping euro, which fell to an 18-month low against the dollar under $1.24.

Bond investors have paid more attention to the euro in recent weeks, taking its slide as a sign of diminishing confidence in Europe's 11-year-old experiment with a single currency.

The worries have persisted despite the $1 trillion initiative worked out last weekend aimed at stanching the crisis, which began in Greece and has threatened to spread throughout the euro zone's fiscally troubled members.

'It's a general push for dollars,' said Steven Ricchiuto, chief economist at Mizuho Securities USA Inc. '$1.25 was a big level, and we've broken through it handily. That set off the flight-to-quality trade.'

The benchmark 10-year note rose a point in price before backing off a touch. It was last up 28/32 in price, pushing the yield down to 3.43 percent from Thursday's close of 3.54 percent.

/... http://www.finanznachrichten.de/nachrichten-2010-05/16906969-treasuries-safe-haven-frenzy-drives-bonds-higher-020.htm