U.S. sees strong demand at auction; bonds stay up

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U.S. sees strong demand at auction; bonds stay up
from MarketWatch.com - MarketPulse
SAN FRANCISCO (MarketWatch) -- The Treasury Department sold $35 billion 2-uear notes on Tuesday at a yield of 0.295%, the highest since June, which helped draw strong demand. Bidders offered to buy 4.02 times the amount of debt offered, compared to an average of 3.79 times at the last four auctions, according to CRT Capital Group. It's the highest so-called bid-to-cover ratio since November. Indirect bidders, a group which includes foreign central banks, bought 33.5% of the auction, compared to an average of 28%. Direct bidders, a group which typically includes domestic money managers, purchased another 38.2%, the highest in at least four years and versus an average of 12.9%. A higher proportion of an auction going to indirect and direct bidders is considered good for the seller -- the government -- and the market. After the auction, the broader market held onto gains. Yields on 10-year notes , which move inversely to prices, fell 6 basis points to 1.76%.