WASHINGTON (dpa-AFX) - After an initial move to the upside, treasuries moved modestly lower over the course of the trading session on Wednesday.
Bond prices pulled back off their early highs and slid steadily into negative territory as the day progressed. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, inched up by 1 basis point to 0.882 percent after hitting a low of 0.851 percent.
The pullback by treasuries came as traders reacted to more upbeat news regarding the coronavirus vaccine candidate being developed by Pfizer (PFE) and BioNTech (BNTX).
Pfizer and BioNTech said the final efficacy analysis of an ongoing Phase 3 study of their coronavirus vaccine candidate indicated a vaccine efficacy rate of 95 percent.
The companies said that efficacy was consistent across age, gender, race and ethnicity demographics and suggested the vaccine candidate also helped to fend off severe disease.
Pfizer and BioNTech said they plan to submit a request to the FDA for an Emergency Use Authorization for the vaccine 'within days.'
In other coronavirus-related news, the FDA announced it has issued an EUA for the first COVID-19 diagnostic test for self-testing at home and that provides rapid results.
Treasuries saw further downside following the release of the results of the Treasury Department's auction of $27 billion worth of twenty-year bonds, which attracted below average demand.
The twenty-year bond auction drew a high yield of 1.422 percent and a bid-to-cover ratio of 2.27. Since being reintroduced in May, the six previous twenty-year bond auctions had an average bid-to-cover ratio of 2.45.
The bid-to-cover ratio is a measure of demand that indicates the amount of bids for each dollar worth of securities being sold.
In U.S. economic news, the Commerce Department released a report showing new residential construction spiked by more than expected in the month of October.
The report said housing starts surged up by 4.9 percent to an annual rate of 1.530 million in October after soaring by 6.3 percent to an upwardly revised rate of 1.459 million in September.
Economists had expected housing starts to jump by 3.2 percent to a rate of 1.460 million from the 1.415 million originally reported for the previous month.
With the bigger than expected increase, housing starts reached their highest annual rate since coming in at 1.567 million in February.
Meanwhile, the Commerce Department said building permits came in at an annual rate of 1.545 million in October, virtually unchanged from the revised rate seen in September.
Building permits, an indicator of future housing demand, had been expected to rise by 0.5 percent to a rate of 1.560 million from the 1.553 million originally reported for the previous month.
Trading on Thursday may be impacted by reaction to reports on weekly jobless claims, Philadelphia-area manufacturing activity and existing home sales.
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