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NEW YORK — Treasury prices retreated Tuesday, a day after investors sought the safety government debt in response to new concerns about the speed of an economic recovery.
Prices for long-term Treasury bonds fell, ending three straight days of gains, as investors less worried that a recovery might be delayed went back into stocks. The Dow Jones industrial average rose 83 points after tumbling 186 points Monday.
Bonds traders were "looking for direction from the stock market," said Kim Rupert, managing director of global fixed income analysis at Action Economics. With stocks rising, the benchmark 10-year Treasury note fell 11/32 to 100 28/32, driving its yield up to 3.52 percent from 3.47 percent late Monday.
Investors have worried about a recovery over the past week as reports indicated that consumers remain uneasy and unlikely to spend freely. Consumer spending accounts for more than two-thirds of all economic activity.
However, some better-than-expected earnings reports from retailers Tuesday eased those concerns somewhat. Both Home Depot Inc. and Target Corp. reported declining profit, but beat analysts' expectations.
Investors brushed off a weaker-than-expected report on July housing starts and a bigger-than-expected decline in wholesale prices to send stocks higher Tuesday. Normally, Rupert said, the housing and wholesale price data would have been a benefit for Treasurys.
The Commerce Department said new home and apartment construction fell 1 percent in July, but it also reported that single-family home building rose for the fifth straight month. Meanwhile, the Labor Department said the producer price index, a measure of inflation at the wholesale level, fell 0.9 percent last month.
Inflation can chip away at the fixed returns of Treasurys over time, so a report showing inflation is not a concern would normally support higher bond prices.
"There's a lot of underlying cross currents, but not a lot of them are adding up to a clear direction," Rupert said. That, coupled with seasonally light volume, has kept trading choppy, she added.
In late trading, the 30-year bond fell 17/32 to 102 11/32, and its yield rose to 4.36 percent from 4.33 percent.
The two-year note fell less than 1/32 to 99 30/32 and its yield rose to 1.03 percent from 1.02 percent.
The yield on the three-month T-bill was flat at 0.17 percent. Its discount rate was 0.18 percent.
The cost of borrowing between banks fell. The British Bankers' Association said the rate on three-month loans in dollars — the London Interbank Offered Rate, or Libor — held steady at 0.43 percent.
