Treasury yields rise as Wall Street looks to hold onto May’s gains

U.S. government debt prices prices were lower Monday morning as investors awaited direction following two consecutive months of stock market gains.

At around 3:25 a.m. ET, the yield on the benchmark 10-year Treasury note was up at 0.6673% and the yield on the 30-year bond climbed to 1.4347%. Yields move inversely to prices.

With a new month beginning on Wall Street, investors are broadly monitoring the reopening of the economy following months of coronavirus-induced lockdown measures. However, many businesses are now also navigating nationwide protests against police brutality triggered by the killing of a black man, George Floyd in Minneapolis.

Market focus is also attuned to rising tensions between the U.S. and China. President Donald Trump on Friday announced that Hong Kong’s special status with the U.S. would be revoked following China’s passage of a national security bill increasing Beijing’s power over the city.

Yields had plunged ahead of the press conference, but Wall Street breathed a sigh of relief when Trump did not announce that the U.S. would be pulling out of the “phase one” U.S.-China trade deal signed in January.

On the data front, the final IHS Markit PMI (purchasing managers’ index) reading for May is expected at 9:45 a.m. on Monday, before May’s ISM manufacturing data and April’s construction spending figures at 10 a.m.

Auctions will be held Monday for $63 billion of 13-week Treasury bills and $54 billion of 26-week bills.