Treasury yields slide after Memorial Day break as traders weigh Iran peace prospects

Treasury yields fell on Tuesday as bond markets returned from a Memorial Day break to bolstered hopes of a Middle East peace deal, even as the U.S. military conducted fresh strikes on Iran. The yield on the 10-year U.S. Treasury note — the key benchmark for U.S. government borrowing — fell more than 6 basis points to 4.510%. The 2-year Treasury note yield, which more closely tracks short-term Federal Reserve interest rate policy, fell more than 6 basis points to 4.066%. The longer-dated 30-year Treasury bond yield fell more than 5 basis points to 5.028%. One basis point is equal to 0.01%, and yields and prices move in opposite directions. Yields fell across the board, catching up with large declines seen in European sovereign yields on Monday. However, European bonds gave some gains on Tuesday as investors mull mixed signals around the status of U.S.-Iran peace talks. U.S. forces carried out what Central Command described as "self defense" strikes in southern Iran early Tuesday. Secretary of State Marco Rubio, who is in India, said that the Strait of Hormuz will ultimately have to be opened "one way or the other." Iran's Islamic Revolutionary Guard Corps on Tuesday said it would retaliate against violations of the ongoing ceasefire after it identified and engaged U.S. drones and an F-35 jet fighter that entered the country's airspace. …