October 16, 2018 / 5:23 AM / 9 months ago

JGBs edge lower as Japanese stocks recover, U.S. Treasury yields rise

TOKYO, Oct 16 (Reuters) - Japanese government bond prices inched lower on Tuesday, as Tokyo shares were on track to eke out a small gain and U.S. Treasury prices slipped with investors' concerns about stock market volatility appearing to be easing.

The December 10-year JGB futures contract ticked down 0.04 point to 150.20, while the yield of the benchmark cash 10-year JGBs rose half a basis point to 0.145 percent.

The 20-year JGB yield and 30-year JGB yield edged up 0.5 basis point each to 0.675 and 0.915 percent, respectively.

Similarly, the five-year yield gained half a basis point to minus 0.065 percent.

The 40-year JGBs held steady at 1.090 percent.

The two-year government bond was untraded.

An auction of 2 trillion yen ($17.86 billion) five-year JGBs drew reasonable demand on Tuesday.

The auction drew demand from traders looking to cover short positions, according to a market participant with a domestic broker.

The bid-to-cover ratio, a gauge of demand, came in at 4.88, slightly lower than 5.53 from the previous auction.

The benchmark Nikkei share average and the broader Tokyo Price Index staged a modest recovery, supported by short-covering in index heavyweights.

U.S. Treasury yields rose on Monday as investors largely shrugged off tensions between the West and Saudi Arabia. ($1 = 111.99 yen) (Reporting by Tokyo Markets team; Editing by Subhranshu Sahu)

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