In the wake of the significant gains observed in the previous session, treasury markets retreated on Wednesday. Bond prices managed to recover some ground from initial downward pressure but ultimately remained in negative territory. As a result, the yield on the ten-year benchmark note, which inversely correlates with its price, increased by 4.2 basis points to 3.785 percent.
The decline in treasuries followed the release of data from payroll processor ADP, which reported stronger-than-anticipated job growth in the private sector for September. According to ADP, private sector employment rose by 143,000 jobs in September, following an upwardly revised increase of 103,000 jobs in August. This exceeded economists' expectations, who had anticipated a rise of 120,000 jobs compared to the initially reported addition of 99,000 jobs for the prior month.
The robust employment figures lessen the likelihood that the Federal Reserve will continue its aggressive stance on interest rate cuts in the upcoming months.
Looking ahead, the Labor Department is scheduled to publish its more comprehensive employment report for September on Friday. Current economic forecasts suggest that the report will indicate an increase of 140,000 jobs for the month, following a rise of 142,000 jobs in August. Meanwhile, the unemployment rate is projected to remain steady at 4.2 percent.
On Thursday, trading activities could be influenced by reactions to the latest U.S. economic indicators, including reports on weekly jobless claims, service sector performance, and factory orders.