Treasurys Prices Fall as Investors Take Profits

Treasurys on Friday gave up some of the previous day's big gains as investors locked in profits ahead of a big round of auctions next week.

The price of the benchmark 10-year Treasury note fell 10/32 to 103 12/32, pushing its yield up to 3.22 percent from 3.18 percent late Thursday. The yield on the 10-year note is closely tied to interest rates on consumer loans.

Stocks also fell Friday after a Labor Department report showed employers shed more jobs than expected in September. Employers cut 263,000 jobs last month, worse than the 180,000 economists polled by Thomson Reuters were expecting.

The unemployment rate rose to 9.8 percent, in line with expectations.

Treasury prices had surged Thursday, pushing yields to their highest levels since the spring, as stocks tumbled on a disappointing manufacturing report and a weaker-than-expected figure on weekly jobless claims.

Matt Hastings, a portfolio manager at Charles Schwab Investment Management, said Friday's retreat after such a big gain the day before was not surprising. Some of Thursday's run-up could have also been tied to traders factoring in the weak monthly jobs report a day early, he said.

Hastings said $71 billion in auctions scheduled for next week is also keeping prices in check. Investors typically sell off bonds in the days ahead of new government auctions in a move known as a "concession," he said.

"The market has done a pretty good job getting concessions heading into auctions," Hastings said.

Selling off Treasurys ahead of an auction will lower the price and push the yield higher. That in turn can help dictate a lower price and higher yield on new bonds about to be issued by the government.

The Treasury Department is scheduled to auction $39 billion in three-year notes on Tuesday, $20 billion in 10-year notes on Wednesday and $12 billion in 30-year bonds on Thursday.

The price of the 30-year bond fell 25/32 to 108 21/32, while its yield rose to 4.00 percent from 3.96 percent. On Thursday, the yield of the 30-year Treasury fell below 4 percent for the first time since April.