Bonds jump on weak earnings, housing fears

Bonds jump on weak earnings, housing fearsThe 10-year Treasury benchmark rises 25/32 to yield 4.80 percent, dollar down sharply against yen.July 26 2007: 11:44 AM EDTNEW YORK (CNNMoney.com) -- Bonds rose sharply Thursday as homebuilders reported weak earnings and a durable orders report came in lower than expected. The 10-year jumped 25/32, or $7.81 on a $1,000 note, to yield 4.80 percent, down from 4.90 percent Wednesday. The 30-year bond climbed 1-3/32, or $10.94 on a $1,000 note, to yield 4.95 percent, down from 5.02 percent. Bond prices and yields move in opposite directions.The 5-year gained 21/32 to yield 4.62 percent. While the 2-year rose 9/32 to yield 4.57 percent.A raft of weak earnings from homebuilders D.R. Horton, Beazer Homes, as well as Pulte and Ryland which reported earnings after hours Wednesday have pushed futures down, making bonds an attractive safe haven for investors. Investors are watching the housing market closely both as a gauge of the economy as a whole and because weakness in homebuilding has the potential to spill over into automotive, lending and construction industries.Lower than expected durable goods orders and tame unemployment figures have only made bonds look more attractive to investors.The pace of new home sales was weaker than expected in June, according to the government's latest look at the battered real estate and home building market.New homes sold at an annual pace of 834,000 in the month, down 6.6 percent from the revised 893,000 rate in May. It was the lowest annual rate for sales since March. Economists surveyed by Briefing.com had forecast sales would slow to a 900,000 annual sales rate in June.Year-over-year, new home sales sank 22.3 percent.In currency trading, the euro bought $1.372 up from $1.371, while the dollar bought ¥118.95 down sharply from ¥120.49 Wednesday.