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Bond prices fell sharply as selling that was incited by a weak auction of 30-year bonds on Thursday continued.
Yesterday, a weak auction of two-year Treasury notes propelled the yield on the benchmark 30-year note to its highest level since August.
The news comes after a weak auction of 30-year Treasury bonds Wednesday, as investors demand higher yields for securities that were left out of the Fed's purchasing plan.
A weak auction of two-year Treasury notes shook up the bond market amid fears of higher interest rates, propelling the yield on the benchmark 30-year note to its highest level since August.
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While analysts cautioned against reading too much into a single bond auction, the weak auction was at the very least a blow to the prestige of Germany, whose economic strength has enabled it to largely dictate how the euro region will cope with the debt crisis.
With a weak hand full of offensive values and lacking defensive tricks, carry the auction as high as possible, as quickly as possible.
A successful auction of seven-year Treasury notes also calmed some concerns after weak demand for debt issues in Britain and the United States the day before.
This week, Sotheby's conducted its weakest auction in a long time.
A solid auction of 30-year bonds helped stocks build their afternoon gains, a day after a weaker offering of 10-year notes sparked an afternoon drop.
There was a silent auction — of shoes.
A larger auction of Italian bonds is set for Thursday.
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