Treasury Yields march higher off the back of a robust jobs report
Treasury yields marched higher on Friday morning after the November nonfarm payrolls report indicated that the job market remained strong, despite the sharp rise in interest rates this year.
After the jobs print hit the market, Treasury yields pushed higher, which added pressure to Treasury-related exchange traded funds.
Yields were lower headed into the jobs report but reversed their direction once the news came out. By mid-morning trading, the U.S. 2-year Treasury yield (US2Y) moved up 11 basis points to 4.36%, the U.S. 10-year Treasury yield (US10Y), gained 7 basis points to 3.60%, and the U.S. 30-year Treasury yield (US30Y) ticked up by 4 basis points to 3.87%.
As yields climbed, Treasury funds and fixed income funds tipped lower. The two largest fixed income ETFs, iShares Core U.S. Aggregate Bond ETF (NYSEARCA:AGG) and Vanguard Total Bond Market Index Fund (NASDAQ:BND), both slid 0.5% early on.
Outside of both AGG and BND, a group of other Treasury based exchange traded funds that have struggled so far include: (NASDAQ:TLT), (IEI), (IEF), (NASDAQ:SHY), (GOVT), (VGSH), (VGIT), (SCHO), (SCHR), (SPTL), (TLH), and (VGLT).
Looking at the data, payrolls were +263K in November compared to the anticipated +200K figure, additionally the unemployment rate held steady at 3.7%.
In broader market news, major market averages sold off sharply after the November jobs report came in stronger than bulls had hoped.