US Treasurys rise on skepticism over Spanish deal

By The Associated Press
Treasury prices rose Monday as early enthusiasm waned for a deal to shore up Spanish banks.
The 10-year Treasury note rose 15.6 cents for every $100 invested. The yield fell to 1.59 percent, down from 1.64 percent in late Friday trading.
Over the weekend, European countries pledged up to $125 billion in loans to Spain to help rescue the country's troubled banks. The news sent stock markets up and Treasury prices down early Monday. The 10-year yield reached 1.71 percent as traders shifted money out of the safest of government bonds. But markets quickly reversed.
One concern is that the loan to Spain will increase the government's debt burden. The loan may also take precedence over other government debt. Both could push borrowing costs up for Spain, making it harder to raise money from bond markets.
The yield on Spanish 10-year government bonds increased to 6.47 percent Monday. The cost of insuring Spanish debt climbed back to near a record high.
In other Treasury trading, the price of the 30-year Treasury bond rose 65.6 cents per $100 invested. That knocked its yield down to 2.71 percent from 2.76 percent late Friday.
The yield on the two-year Treasury note remained at 0.27 percent. The yield on the three-month Treasury bill also stayed put at 0.08 percent.
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