Treasuries declined along the curve on Tuesday, as optimism surrounding a potential coronavirus vaccine and hope for a recovery in business activity seemed to reduce demand for U.S. government bonds. The perceived risk-on mood seemed to overshadow fresh reports that the Trump Administration was displeased with Beijing, and was looking at a range of options to sanction Chinese officials over plans to implement new national security laws of Hong Kong.

The yield on the benchmark 10-year note rose two basis points to 0.68%, while the yield on the 30-year bond added six basis points to 1.43%. On the short-end of the curve, the yield on the two-year note held steady at 0.17% following the largest auction on record for the maturity. The Treasury sold $44 billion of the notes at a high yield of 0.178% to solid demand. The bid-to-cover ratio was 2.680 compared to the prior sale ratio of 3.100. On the data front, the Conference Board’s gauge of consumer confidence improved slightly in May from the prior month’s downward revised figure. Separately, new home sales edged up 0.6% in April, rebounding from the previous 13.7% decline. Now is a great time to Purchase or Refinance!