German bunds rise modestly following weakness in energy prices; investors eye US jobs data

The German bunds traded modestly firmer Friday as investors poured into safe-haven instruments amid losses in riskier assets including equities and crude oil.

The yield on the benchmark 10-year bond, which moves inversely to its price, fell 1 basis point to 0.150 percent, the yield on long-term 30-year note dipped 1-1/2 basis points to 0.763 percent and the yield on short-term 2-year bond slid 1/2 basis point to -0.632 percent by 09:30 GMT.

The German bunds have been closely following developments in oil markets because of their impact on inflation expectations. Crude oil prices extended their downward trend amid record oil stocks build in the United States last week. The International benchmark Brent futures fell 0.10 percent to $47.38 and West Texas Intermediate (WTI) dipped 0.09 percent to $44.70 by 09:40 GMT.

The U.S. presidential election is due on November 8 in which the race between Democrat candidate Hillary Clinton and Republican Donald Trump is narrowing. The market is wary of a Brexit-like outcome at the presidential election on November 8 as recent polls showed a tighter race between the two Presidential candidates.

The RealClearPolitics poll displayed that Democratic nominee Hillary Clinton’s lead over her Republican rival Trump has narrowed down to 2.2 percentage points from more than 7 points two weeks ago.

Treasury prices are expected to rally this week as investors assume that the triumph of Republican Party nominee Donald Trump over Democratic Clinton will weaken the greenback against major trading currencies, while boosting demand for safe-haven assets.

Markets now look ahead to the United States October employment report on Friday.

Meanwhile, the German stock index DAX Index traded 0.83 percent lower at 10,242 by 09:30 GMT.