August 7, 2018 / 2:49 PM / 4 months ago

U.S. Treasury investors most bearish in eight weeks -survey

NEW YORK, Aug 7 (Reuters) - Bond investors turned the most bearish in eight weeks on longer-dated U.S. Treasuries as the government planned to issue record amounts of 10-year and 30-year debt later this week, a J.P. Morgan survey showed on Tuesday.

The U.S. Treasury Department said last week it would sell $26 billion of 10-year notes on Wednesday and $18 billion in 30-year bonds on Thursday, as part of its $78 billion quarterly refunding this week.

The share of investors who said on Monday they were short, or holding fewer longer-dated U.S. government debt than their portfolio benchmarks, climbed to 34 percent from 30 percent a week ago, according to the bank’s latest Treasury client survey.

The share of investors who said they were long, or holding more longer-dated Treasuries than their benchmarks, decreased to 15 percent from 17 percent the week before.

The gap between the shares of shorts and longs, or net shorts, expanded to 19 percentage points, the widest since June 11. This compared with 13 percentage points a week earlier, J.P. Morgan said.

Early on Tuesday, the yield on benchmark 10-year Treasury notes was up nearly 3 basis points at 2.966 percent. It fell to a two-week low of 2.925 percent on Monday on safe-haven demand for U.S. government debt spurred by concerns about the trade tension between China and the United States.

Those investors who told J.P. Morgan they were neutral, or holding longer-dated bonds matching their benchmarks, fell to 51 percent from 53 percent.

Reporting by Richard Leong; Editing by Andrea Ricci

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