Canadian bonds down following firm crude oil prices

The Canadian bonds slid on Tuesday, following rally in the crude oil prices. The yield on the benchmark 10-year Treasury note which moves inversely to its price rose 1 basis point to 1.115 percent and the yield on the short-term 2-year bonds also climbed 1/2 basis points to 0.505 percent by 13:00 GMT.

The Canadian bonds have been closely following developments in oil markets because of their impact on inflation expectations, which are well below the Bank of Canada's target. Today, oil prices rose as investors took advantage of a two-day slide in crude following Britain's vote to leave the European Union to lock in lower prices. A looming strike at several Norwegian oil and gas fields threatened to cut output in western Europe's biggest producer, also helped support prices on Tuesday. The International benchmark Brent futures rose 2.62 percent to $49.02 and West Texas Intermediate (WTI) climbed 3.04 percent to $47.74 by 12:50 GMT.

Lastly, Canadian stocks are poised to rebound after brutal losses in the previous two session, as global fears about the UK's Brexit appear to have eased at least temporarily. Crude oil and base metal prices rallied on hopes the U.S. and China can pick up any slack in demand from Europe.

The U.S. dollar also relented, helping commodities higher. The S&P/TSX Composite Index is down more than 400 points since the start of Friday's trading, with strong gold stocks helping to limit the damage.