U.S. 10-year Treasury yield rises to 4.96% as job openings increase
Key Facts
The U.S. 10-year Treasury yield rose to 4.96% on Tuesday, November 3, from 4.91% late Monday, after a government report showed an increase in job openings in September. The Associated Press said the report helped push the yield higher in a session that coincided with the U.S. midterm elections. The yield move puts the labor market at the forefront of economic monitoring alongside the vote, while an early European trading report by Dow Jones also noted a rise in the yield at that time. Laura Cooper of Nuveen said the elections’ effect on the bond market was likely to be "short-term noise rather than a sustained repricing."
The U.S. Bureau of Labor Statistics released its September Job Openings and Labor Turnover Survey on November 3. Job openings totaled 7.523 million, compared with 7.190 million in August after revision, while the job openings rate rose to 4.5% from 4.3%. The figures show an increase in openings between the two months, but came alongside other indicators in the report describing overall changes as limited. Hires totaled 5.402 million in September, compared with 5.271 million in August. The bureau said the total number of job openings and total hires changed little, despite the recorded increases in openings and hires between the two months.
The report showed quits rose to 3.4 million in September, while layoffs and discharges remained at 1.6 million, little changed. These indicators form part of a broader reading of worker flows in the labor market, alongside job openings and hires. In early European trading on November 3, the two-year Treasury yield rose one basis point to 4.593%, and the 10-year yield climbed 2.1 basis points to 4.914%. Those figures cover early European trading, while the Associated Press reported the benchmark yield at 4.96% on Tuesday, after 4.91% late Monday. The comparison reflects the yield’s movement during the news session without conflating early European trading with the day’s close.
U.S. stocks posted a mixed performance during the election session: the S&P 500 rose 0.4%, while the Dow Jones Industrial Average fell 0.4% and the Nasdaq Composite gained 0.8%. Against the backdrop of the elections, a Reuters report before the vote said investors were watching the potential impact of the results on artificial intelligence spending and debt-ceiling negotiations. The agency reported that a divided Congress could increase the risks of a government shutdown and debt-ceiling clashes, and also linked bond-market concerns to rising deficit levels and growing interest costs. Reuters said midterm elections do not usually lead to major market moves, while Cooper expected their effect on bonds to be short-term. According to the Associated Press, the S&P 500 has posted a positive return in the six months following every midterm election since 1970, citing an analyst at Edward Jones.
The Associated Press had previously reported that the 10-year yield jumped to 5.10% on September 23 from 4.96% the previous day, amid inflation concerns following an economic report that was stronger than expected. The agency said at the time that higher yields weigh on stock prices and other investments and slow the economy by increasing borrowing costs. That background places the yield move in the context of its broader effect on markets and financing, but pertains to the September session and does not describe the cause of the move on November 3. In this session, the Associated Press reported that the job-openings report helped push the yield higher, while Dow Jones said investors were monitoring JOLTS data and the elections without attributing the move to any one factor. The vote’s effect on bonds remained under watch, with Nuveen estimating that its likely impact would be short-term noise rather than an extended repricing.
Attention after the job-openings data turns to the U.S. October employment report, scheduled for release on November 6 at 8:30 a.m. Eastern time. The report will provide a later checkpoint on the labor market after the September JOLTS reading published on November 3. The October JOLTS release is scheduled for December 1 at 10:00 a.m. Eastern time, according to the Bureau of Labor Statistics calendar. The schedule allows investors to follow U.S. employment data through successive releases in November and December. These remain the upcoming releases listed by the bureau.