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Treasury, mortgage bond yields rise after four-day decline

June 17, 2009 |  3:08 pm

The slide in Treasury bond and mortgage bond yields stalled out today.

The 10-year T-note yield ended at 3.69%, up slightly from 3.67% on Tuesday. The yield had tumbled for four straight sessions after reaching an eight-month high of 3.99% a week ago.

The stock market's pullback in recent sessions had helped drive some investors into the relative haven of Treasury issues. But the rally in government bonds ran out of steam despite another weak day for Wall Street overall.

Some traders said potential bond buyers were looking ahead to another load of securities that will hit the market next week, when the Treasury will auction two-, five- and seven-year notes. Supply concerns had been one of the factors driving Treasury yields sharply higher in May and early June.

Mortgage bond yields, benchmarks for lenders setting home loan rates, also rose today. The yield on 30-year Fannie Mae mortgage-backed bonds ended at 4.66%, up from 4.58% on Tuesday but still down from 5.07% a week ago.

The surge in home loan rates early last week pushed mortgage refinancing activity to its lowest level since November, the Mortgage Bankers Assn. said today. The group’s index of refi applications plunged 23% in the week that ended Friday, the fourth straight decline.

But mortgage rates have begun to ease since Thursday.

-- Tom Petruno