Treasuries Move Sharply Higher Amid Continued Ukraine Worries

After ending yesterday’s choppy session modestly higher, treasuries showed a substantial move to the upside during trading on Friday.

Bond prices surged early in the session and remained sharply lower throughout the day. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, tumbled 12 basis points to 1.724 percent.

Treasuries benefited from their appeal as a safe haven amid continued concerns about the impact of the Russian invasion of Ukraine, with Russia ratcheting up its attacks.

Russia has reportedly taken control of Ukraine’s Zaporizhzhia nuclear power plant, which is the largest nuclear power plant in Europe.

The Russian attack on the plant had previously caused a fire to break out at the facility, raising concerns about a potential nuclear disaster.

Worries about Ukraine overshadowed a typically closely watched Labor Department report showing U.S. employment once again jumped by much more than expected in the month of February.

The report showed non-farm payroll employment spiked by 678,000 jobs in February after surging by an upwardly revised 481,000 jobs in January.

Economists had expected employment to increase by 400,000 jobs compared to the addition of 467,000 jobs originally reported for the previous month.

With the stronger than expected job growth, the unemployment rate dipped to 3.8 percent in February from 4.0 percent in January. The unemployment rate was expected to edge down to 3.9 percent.

The report also showed a slowdown in the annual rate of wage growth, which economists suggested could lead to less pressure on the Federal Reserve to aggressively raise interest rates.

Developments in Ukraine are likely to remain in focus next week, while traders are also likely to keep an eye on a Labor Department report on consumer price inflation.

Bond trading may also be impacted by reaction to the results of the Treasury Department’s auctions of three-year and ten-year notes and thirty-year bonds.

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