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Treasuries Close Nearly Flat Following Lackluster Session

After moving higher over the two previous sessions, treasuries turned in a lackluster performance during trading on Thursday.

Bond prices spent the day bouncing back and forth across the unchanged line before closing roughly flat. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, edged down by less than a basis point to 0.677 percent.

The choppy trading on the day came as traders digested a mixed batch of U.S. economic data, including a Labor Department report showing initial jobless claims pulled back further off their record high but remain at an elevated level.

The report said initial jobless claims dropped to 2.438 million in the week ended May 16th, a decrease of 249,000 from the previous week's revised level of 2.687 million.

Economists had expected jobless claims to tumble to 2.400 million from the 2.981 million originally reported for the previous week.

Jobless claims fell for the seventh straight week after reaching a record high of 6.867 million in the week ended March 28th.

The total number of new claims since the coronavirus-induced lockdowns began in mid-March still reached 38.6 million.

Meanwhile, the National Association of Realtors released a report showing another steep drop in U.S. existing home sales in the month of April.

NAR said existing home sales plunged by 17.8 percent to an annual rate of 4.33 million in April after tumbling by 8.5 percent to 5.27 million in March. Economists had expected existing home sales to plummet to a rate of 4.30 million.

The continued nosedive pulled existing home sales down to their lowest level since hitting 3.45 million in July of 2010.

A separate report released by the Federal Reserve Bank of Philadelphia showed a slowdown in the pace of contraction in regional manufacturing activity in the month of May.

The Philly Fed said its diffusion index for current general activity climbed to a negative 43.1 in May from a negative 56.6 in April. Economists had expected the index to increase to a negative 41.5.

The index rebounded from the nearly 40-year low set in the previous month, but a negative reading still indicates a contraction in regional manufacturing activity.

A lack of major U.S. economic data may lead to another choppy trading session on Friday as some traders look to get a head start on the long Memorial Day weekend.

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