In the wake of several sessions with modest gains, U.S. Treasury securities experienced a significantly stronger upward move during Thursday's trading.
Bond prices surged early in the session and maintained solid gains throughout the day. Consequently, the yield on the ten-year benchmark note, which inversely correlates with its price, plummeted by 13.3 basis points to settle at 3.976 percent.
This sharp decline brought the ten-year yield below the 4.0 percent mark for the first time since January.
The rally in treasuries was fueled by a series of disappointing economic data, raising concerns about the U.S. economic outlook.
A report from the Institute for Supply Management indicated that U.S. manufacturing activity contracted unexpectedly at a faster rate in July.
According to the ISM, the manufacturing PMI fell to 46.8 in July from 48.5 in June, with a reading below 50 signifying contraction. Economists had anticipated the index to edge up to 48.8 percent.
This steeper-than-expected decline brought the manufacturing PMI to its lowest level since November 2023, when it hit 46.6.
Additionally, the Labor Department reported that first-time claims for U.S. unemployment benefits rose to their highest level in nearly a year for the week ending July 27th.
The report highlighted that initial jobless claims increased to 249,000, up by 14,000 from the previous week's unrevised figure of 235,000. Economists had forecasted a rise to 236,000.
This unexpected upturn pushed jobless claims to their highest level since reaching 258,000 in the week ending August 5, 2023.
Looking ahead, Friday's trading is anticipated to be influenced by market reactions to the Labor Department's closely monitored employment report for July.
