Initial jobless claims dropped more than what economists have forecasted and the trade deficit narrowed in July, helping to discourage demand at the government’s 30-year bond auction and this directly took the US bond  treasury market to end up the day on a dull note. 
(source: reuters.com).

 

Martin Mitchell, head government bond trader in Baltimore at Stifel Nicolaus & Co said:  “We are in the midst of a heavy week in supply in Treasuries and corporates, which is weighing on the market. The market seems to want to correct lower. The data shows a better picture in the labor sector.”

Stocks rose and US labor market report  improved concerns that the recovery in the world’s largest economy is faltering, damping demand for the perceived safety of government debt and this had a negative impact on the German government bonds as they were down at the end of the day yesterday.   
(source: reuters.com).

Orlando Green, assistant director of capital-markets strategy at Credit Agricole Corporate & Investment Bank in London said:  “The fall in bunds reflects a shift in risk sentiment. Equities are higher and sovereign spreads are tightening a little, and it all helps the general picture that event risks are diminishing.”

Ten-year german bonds ended up higher at 2.34 percent.