Treasuries retreat as worries over Spain ease, US stocks rally

(April 17th, 2012) Treasuries retreated for the first time in three days as risk sentiment improved following news of Spain raising more than its target at an auction Tuesday, pushing all three stock indices to their highest levels since March 13.

Treasuries snapped their three-day winning streak as ten-year yields climbed from the lowest level in six weeks after latest German investors confidence reading came in better than expected and Spanish debt demand picked up. US ten-year yields climbed 0.02 percent or 2 basis points, to 2.0 percent, even as US industrial production remained unchanged for the second month in March and home starts decreased unexpectedly.

The Vanguard Total Bond Market ETF (BND) shed 0.01 points, or 0.01 percent over yesterday’s close while the iShares Barclays 20 Year Treasury Bond ETF (TLT) dropped 0.01 point for the day.

US stocks surged higher Tuesday as increased demand for Spanish debt eased global concerns over Europe and investors analyzed earnings data that pushed the Dow above the 13,000 mark for the first time in more than a week.

The Dow Jones Industrial Average (DJIA) zoomed 194.13 points, or 1.5 percent, to 13,115.54, its biggest monthly gain in more than a month. Tech stocks rebounded strongly as all the 30 components of Dow advanced Tuesday. International Business Machines Corp (IBM) topped the gainer’s list, rising 2.3 percent ahead of its results after market closure.

Apple (AAPL) surged 5.1 percent, breaking a five-day losing streak that had pushed the stock down 9 percent. Despite its pull-back, Apple remains one of the top performers this year, gaining more than 40 percent since Jan.

Walt Disney (DIS), Kraft Foods (KFT) and Coca-Cola Co (KO) all rose more than 2 percent for the day.

The S&P 500 Index (SPX) rose 21.21 points, or 1.6 percent, to 1390.78 with the technology sector posting the day’s biggest gains. All the 10 sectors closed higher Tuesday after tech had declined the most on Monday.

The NASDAQ Composite (COMP) added 54.42 points, or 1.8 percent, to close at 3042.82 after retreating for two straight sessions.

For every stock declining, more than three stocks advanced on the NYSE.

Oil prices for May delivery gained $1.27 to close at $104.20 a barrel.

Gold futures for April delivery rose marginally by $1.60 to settle at $1,683.90 an ounce.