Treasuries Close Slightly Higher After Another Lackluster Session

After closing nearly unchanged for two consecutive sessions, treasuries continued to show a lack of direction during trading on Wednesday.

Bond prices spent most of the day lingering near the unchanged line before closing slightly higher. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, edged down by nearly a basis point to 0.926 percent.

The choppy trading on the day came as many traders remained away from their desks ahead of the New Year's Day holiday on Friday.

Traders largely shrugged off a report from the National Association of Realtors showing a continued decrease in U.S. pending home sales in the month of November.

NAR said its pending home sales index slid 2.6 percent to 125.7 in November after falling by 0.9 percent to 129.1 in October. Economists had expected pending home sales to come in unchanged.

A pending home sale is one in which a contract was signed but not yet closed. Normally, it takes four to six weeks to close a contracted sale.

Meanwhile, a separate report from MNI Indicators showed an unexpected acceleration in the pace of growth in Chicago-area business activity in the month of December.

MNI Indicators said its Chicago business barometer rose to 59.5 in December from 58.2 in November, with a reading above 50 indicating growth. Economists had expected the barometer to dip to 57.0.

Traders also kept an eye on developments in Washington, as lawmakers haggle over increasing stimulus checks to $2,000 from $600.

Senate Majority Leader Mitch McConnell, R-Ken., blocked Democratic efforts to fast-track a House approved measure to increase the size of the checks.

McConnell has instead proposed a bill that would tie the bigger stimulus checks to the repeal of a provision that protects social media platforms and the creation of an election fraud commission.

With Democrats likely to oppose the combined package, Senate Minority Leader Chuck Schumer, D-N.Y., described the move by McConnell as a "blatant attempt to deprive Americans of a $2,000 survival check."

Political observers have suggested McConnell added the so-called "poison pill" to give cover to Georgia Senators seeking re-election in next week's crucial run-offs.

A report on weekly jobless claims may attract attention on Thursday, although trading activity is likely to remain light as some traders look to get a head start on New Year's Eve celebrations.

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