By Joseph Adinolfi, MarketWatch

NEW YORK (MarketWatch) -- Treasury yields continued to climb Tuesday, a day after the 10-year yield recorded its largest single-session gain in two weeks, as up to $28 billion in newly announced corporate debt drew demand away from Treasurys.

The yield on the 10-year note was up 1.7 basis point to 2.101%, according to Tradeweb data. The two-year note yield was up 0.8 basis point at 0.670%.

The yield on the 30-year bond was up 0.7 basis point to 2.692%.

Bond yields move inversely to prices.

An influx of newly issued corporate debt also weighed on Treasurys, as investors sold U.S. debt to make room for new bonds with more attractive yields, said Donald Ellenberger, senior portfolio manager and head of multisector strategies at Federated Investors.

Actavis PLC (ACT) moved forward with a $21 billion bond offering Tuesday. The company is raising money to pay for its acquisition of Botox-maker Allergan Inc. (AGN) Exxon Mobil Corp. (XOM) also announced plans to sell up to $7 billion in new bonds.

Ellenberger noted that heavy selling by portfolio managers to accommodate Actavis's bond issue occurred Monday, after the Actavis deal was announced.

Treasury yields have been steadily moving higher since the 10-year yield fell to its lowest level since April 2013 on Feb. 2., as a drumbeat of strong economic indicators out of the eurozone and recovering oil prices have renewed demand for risky assets like U.S. equities.

The one widely watched piece of U.S. economic data expected Tuesday was new car sales figures, which showed a decline in sales of total light motor vehicles in January.

Sales fell 1.2% to 16.7 million on an annualized basis, compared with 16.9 million in December. Economists polled by MarketWatch had expected 16.7 million in sales.

U.S. stocks opened lower Tuesday as European stocks continued to slide. The S&P 500 was down 0.44% to 2,107.9, and the Nasdaq index (RIXF) fell back under 5,000. European indexes were also lower, with the Stoxx 600 down 0.43%, or 1.73, to 389.56%.

In other markets, the U.S. dollar's recent strength against the euro caught the eye of bond investors, who were watching to see if the dollar would resume its upward trajectory against the euro.

"There has been a pretty high correlation between the dollar and Treasury yields over the last few months as the dollar has gone up, yields have gone down," Ellenberger said. "In the event we see the resumption of the bull trend, the dollar could pull Treasury yields lower a bit."

The euro (EURUSD) traded flat against the euro Tuesday, failing to retake the $1.1200 level. The shared currency was last at $1.1195, compared with $1.1183 Monday.

Subscribe to WSJ: http://online.wsj.com?mod=djnwires

Exxon Mobil (NYSE:XOM)
Historical Stock Chart
From Feb 2024 to Mar 2024 Click Here for more Exxon Mobil Charts.
Exxon Mobil (NYSE:XOM)
Historical Stock Chart
From Mar 2023 to Mar 2024 Click Here for more Exxon Mobil Charts.