After ending the previous session nearly unchanged, treasuries showed a notable move to the downside during trading on Tuesday.
Bond prices came under pressure in morning trading and remained firmly negative throughout the afternoon. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, climbed 3.8 basis points to 0.955 percent.
The weakness among treasuries came as traders remain optimistic about an economic recovery despite the recent spike in coronavirus cases.
Adding to the positive sentiment, a report released by the Institute for Supply Management showed an unexpected acceleration in the pace of growth in manufacturing activity in the month of December.
The ISM said its manufacturing PMI climbed to 60.7 in December after dipping to 57.5 in November, with a reading above 50 indicating growth. Economists had expected the index to edge down to 56.6.
With the unexpected increase, the manufacturing index reached its highest level since hitting 61.3 in August of 2018.
However, economists noted the headline index was artificially boosted by a jump by the supplier deliveries index, which suggested deliveries slowed at a faster rate.
Selling pressure was also kept somewhat in check as traders await the results of two key Senate runoffs in Georgia.
The outcome of the runoff elections will determine which party controls the Senate and could have a major impact on what President-elect Joe Biden is able to accomplish.
Even with a Democratic-controlled Senate, Biden may still face difficulty pushing through his proposed tax policies but could have more success on issues like government spending, including increasing the size of stimulus checks.
The results of the elections are likely to attract attention on Wednesday along with a report on private sector employment and the minutes of the latest Federal Reserve meeting.
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