Bonds brace for jobs data, yields near 2-week high

TOKYO (Reuters) – U.S. Treasuries moved little in Asia on Friday, with their yields stuck near two-week highs and seen rising more if data points to a further recovery in the U.S. jobs market later in the day.

* The yield on 10-year notes stood at 3.56 percent, little changed from late U.S. levels. It rose to 3.57 percent on Thursday, its highest in two weeks, with the next yield resistance seen at 3.63 percent.

* T-bond futures stood at 117-28/32, up 2.5/32 from late U.S. levels, after marking a 3-week low around 117-25.5/32 on Thursday and still not far from a 9-month trough of 117-22/32 hit last month.

* The near-term outlook hinges on the U.S. jobs report due at 8:30 a.m. (1330 GMT). Economists in a Reuters survey forecast 185,000 jobs were created in the month compared with 36,000 in January.

* But players also said market expectations might have risen above a gain of 200,000 after strong data from a private payroll processor on Wednesday and a fall in initial jobless claims figures on Thursday.

* “The market is already expecting a fairly strong reading in today’s jobs report. So unless the data is surprisingly strong, the data is unlikely to cause a big fall in Treasuries,” said Shinichiro Kadota, non-yen strategist at Barclays Capital.

(Reporting by Hideyuki Sano; Editing by Joseph Radford)