Yield on 2-year Treasury dips as calm returns to bond markets after sell-off

The yield on the 2-year U.S. Treasury note dipped Wednesday as global bond markets stabilized following the previous session's sell-off on the back of a surprise policy shift from the Bank of Japan.

The yield on the 2-year Treasury bond fell 3 basis points to 4.236%, while the yield on the benchmark 10-year Treasury note traded flat at 3.688%. Yields move inversely to prices.

Global bond markets sold off on Tuesday after the Bank of Japan tweaked its yield curve controls to allow the yield on its 10-year JGB to move 0.5% either side of its 0% target, up from 0.25% previously, in a move aimed at cushioning the effects of protracted monetary stimulus measures.

Risk-on sentiment returned in early premarket trade on Wall Street Wednesday as investors assessed earnings from Nike and FedEx that sent both companies higher.

November existing home sales and December consumer confidence figures are all due out of the U.S. on Wednesday morning.