2018.12.1715:26:00UTC+00Treasuries Move Higher Amid Substantial Volatility On Wall Street

After ending last Friday's trading modestly higher, treasuries saw some further upside over the course of the trading session on Monday.

Bond prices reached new highs in afternoon trading before moving roughly sideways going into the close. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, fell by 3.4 basis points to 2.857 percent.

The continued strength among treasuries came amid considerable volatility on Wall Street, with stocks recovering from early weakness only to pullback sharply in the afternoon.

With the sell-off, the Dow has tumbled to a seven-month intraday low, while the Nasdaq and the S&P 500 have slumped to their lowest intraday levels in ten months.

Treasuries also benefited from the release of some disappointing U.S. economic data, including a report from the National Association of Home Builders unexpectedly showing a continued deterioration in homebuilder confidence in the month of December.

The report said the NAHB/Wells Fargo Housing Market Index dropped to 56 in December after tumbling to 60 in November. Economists had expected the index to inch up to 61.

With the unexpected monthly decrease, the housing market index tumbled to its lowest level since hitting 54 in May of 2015.

NAHB Chief Economist Robert Dietz called the housing slowdown an "early indicator of economic softening."

A separate report from the New York Federal Reserve showed a much bigger than expected slowdown in the pace of growth in regional manufacturing activity in December.

A report on new residential construction in November may attract attention on Tuesday, although trading activity could be somewhat subdued as the Federal Reserve's two-day monetary policy meeting gets underway.