Treasuries Pull Back Sharply Amid Optimism About Greece

(RTTNews) - After ending the previous session roughly flat, treasuries moved sharply lower over the course of the trading day on Tuesday.

Bond prices came under pressure in early trading and saw further downside as the day progressed. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, jumped 10.7 basis points to 1.78 percent.

With the substantial increase on the day, the ten-year yield regained some ground after hitting its lowest levels in well over a year.

The sharp pullback by treasuries was partly due to developments in Greece, where the new government reportedly dropped calls for a write-down of its foreign debt.

Greek Finance Minister Yanis Varoufakis expressed optimism that a deal between Greece and Europe regarding the country's bailout program will soon be reached.

The economist-turned-finance minister ruled out accepting more bailout cash while hinting that he had a solution to end the confrontation with international creditors.

Varoufakis will meet with European Central Bank President Mario Draghi in Frankfurt on Wednesday and German Finance Minister Wolfgang Schäuble in Berlin on Thursday.

A rally on Wall Street also likely weighed on treasuries, with stocks moving sharply higher along with the price of crude oil.

Crude oil for March delivery jumped $3.48 to $53.05 a barrel after surging up $1.33 a barrel on Monday and soaring $3.71 a barrel last Friday.

Economic data may be back in focus on Wednesday, with traders likely to keep an eye on reports on private sector employment and service sector activity.