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Treasuries Close Nearly Flat Following Lackluster Session

After initially moving to the upside, treasuries show a lack of direction over the course of the trading session on Friday.

Bond prices spent most of the day lingering near the unchanged line before closing roughly flat. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, inched up by less than a basis point to 1.774 percent.

The choppy trading on the day came as traders seemed reluctant to make significant moves amid lingering uncertainty about a U.S.-China trade deal.

Recent reports have suggested the signing of a phase one trade deal could be delayed until next year as U.S. and Chinese officials struggle to reach agreement on core issues.

The next round of U.S. tariffs on Chinese goods is set to take effect on December 15th, potentially complicating efforts to reach an agreement.

In remarks at Bloomberg's New Economy Forum in Beijing, Chinese President Xi Jinping said China wants to work toward a phase one agreement on the basis of mutual respect and equality but will fight back if necessary.

Xi met with former U.S. Secretary of State Henry Kissinger at the forum, reportedly describing U.S.-China relations as being at a critical juncture

"China and the United States should step up communication on strategic concerns to avoid misjudgment and enhance mutual understanding," Xi told Kissinger, according to China's state-run Xinhua News Agency.

Meanwhile, President Donald Trump said in an interview on Fox News this morning that a trade agreement with China is "very close" and that the two economic superpowers have a "very good chance to make a deal."

Traders largely shrugged off a report from the University of Michigan showing a much bigger than expected upward revision to its reading on U.S. consumer sentiment in the month of November.

The report said the consumer sentiment index for November was upwardly revised to 96.8 from the preliminary reading of 95.7. The revised reading is well above the final October reading of 95.5.

Next week's trading may be somewhat subdued due to the Thanksgiving Day holiday on Thursday, although traders are likely to keep an eye on reports on new home sales, consumer confidence, durable goods orders, and personal income and spending.

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