Long Bond Skids as U.S. Picks Up Recovery Tab

Anticipation of government spending -- on military efforts and clean-up costs in New York City -- sent longer-dated issues tumbling

Bond bulls were turned on their head Tuesday as fiscal concerns conspired with a rebound in the Dow to push the yield on the 30-year bond back above 5.50%. The long bond lost over two points intraday with the yield climbing over 15 basis points on the session, as a result of expectations of fiscal profligacy, forced selling by insurance companies and a rebound in the Dow.

To continue reading this article you must be a Bloomberg Professional Service Subscriber.