Treasurys slide as Dow soars past 10,000

NEW YORK — Treasurys tumbled on Wednesday as solid earnings reports from two bellwether companies sent stocks soaring.

In late trading, the benchmark 10-year Treasury fell 18/32 to 101 22/32 and its yield rose to 3.42 percent from 3.35 percent late Tuesday. The 30-year bond fell 1 7/32 to 103 28/32, pushing its yield up to 4.27 percent from 4.20 percent.

Treasurys fell as investors abandoned the safety of government debt in favor of stocks and commodities. Surprisingly strong earnings reports from Intel Corp. and JPMorgan Chase & Co. buoyed stocks, while a falling dollar drove demand for oil and other commodities.

The Dow Jones industrials closed above 10,000, a level not seen in a year. All the major indexes rose more than 1 percent.

Stocks had mostly fallen Tuesday, giving a boost to Treasurys, after a disappointing drop in sales at Johnson & Johnson touched off fears that revenue at companies would continue to fall short of expectations. The reports from Intel and JPMorgan eased some of those concerns and added to the market’s optimism that the economic recovery is under way.

Analysts said the growing confidence in economy was evident in the fact that Treasurys were falling.

Stocks and Treasurys usually move inversely with one another, as investors tend to move in to government bonds as a precaution when the economic outlook is uncertain. But in recent weeks, both stocks and Treasurys had risen as traders, largely underinvested after the panic selling of last fall, put more money to work in a variety of assets.

“We saw many days where equities rallied and fixed income rallied. That was an expression of capital coming off the sidelines and people of very different views putting money to work,” said Christian Cooper, an interest rate strategist at RBC Capital Markets. “That feels like it’s lagging right now. It’s telling that the tone has changed.”

In other trading, the two-year note was flat at 100 5/32 and its yield stood unchanged at 0.92 percent.

The yield on the three-month T-bill was flat at 0.06 percent. Its discount rate stood at 0.07 percent.

The cost of borrowing between banks was unchanged. The British Bankers’ Association said the rate on three-month loans in dollars — the London Interbank Offered Rate, or Libor — held steady at 0.28 percent.