WASHINGTON (dpa-AFX) - After coming under pressure early in the session, treasuries regained some ground over the course of the trading day on Monday.
Bond prices climbed well off their worst levels of the day but still closed in negative territory. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, rose 2.4 basis points to 4.477 percent after reaching a high of 4.516 percent.
The early weakness among treasuries came amid a spike by the price of crude oil, with U.S. crude oil futures soaring by as much as 8.5 percent.
Crude oil prices surged after Iran's state-affiliated news outlet Tasnim said Tehran will halt peace talks with the U.S. and completely close the Strait of Hormuz in response to Israeli attacks in Lebanon.
The report came after U.S. Central Command said it conducted 'self-defense strikes' on Iranian radar and command and control sites for drones in Iran over the weekend.
Iran's Islamic Revolutionary Guard Corps also said it targeted an airbase allegedly used in a U.S. attack on a telecommunications tower on Sirik Island in southern Hormozgan province.
However, crude oil prices pulled back off their highs after President Donald Trump said talks with Iran are continuing at a 'rapid pace,' contributing to the recovery attempt by treasuries.
Trump also said he had a 'very productive call' with Israeli Prime Minister Benjamin Netanyahu and claimed 'there will be no Troops going to Beirut, and any Troops that are on their way, have already been turned back.'
'Likewise, through highly placed Representatives, I had a very good call with Hezbollah, and they agreed that all shooting will stop,' he added. 'That Israel will not attack them, and they will not attack Israel.'
On the U.S. economic front, the Institute for Supply Management released a report showing manufacturing activity in the U.S. expanded for the fifth consecutive month in May.
The ISM said its manufacturing PMI rose to 54.0 in May from 52.7 in April, with a reading above 50 indicating growth. Economists had expected the index to inch up to 53.1.
With the bigger than expected increase, the manufacturing PMI reached its highest level since hitting 55.9 in May 2022.
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