By Joseph Adinolfi, MarketWatch

NEW YORK (MarketWatch)-- The 10-year and 30-year Treasury bond yields trended lower Friday, but remained up 4.50% and 1.10% for the week, as portfolio managers' end-of-the-year position adjustments were exaggerated by an illiquid market.

Investors rushed into stocks this week after Federal Reserve Chairwoman Janet Yellen hinted that the central bank would be careful to raise interest rates gradually in 2015, restoring investor confidence in risky assets.

The yield curve continued a steepening trend that has been in place for most of 2014, said Donald Ellenberger, senior portfolio manager and head of multi-sector strategies. The spread between the two-year and 10-year yield declined by five basis points to 152 basis points.

Ellenberger added that small position adjustments had an outsize effect on the market Friday.

"We could easily attribute today's price activity to random buying and selling in a fairly illiquid market," Ellenberger said.

Oil found its footing Friday, as West Texas Intermediate crude (CLF5) closed 6.6% higher at $57.95, which attracted investors away from the bond market.

The 30-year yield (30_YEAR) was down 4.8 basis point to 2.764%, according to data from Tradeweb. 10-year yields (10_YEAR) were down 3.3 basis points to 2.171%. Two-year yields (2_YEAR) added 1.7 basis points to 0.650%. Five-year yields (5_YEAR) were down 0.4 basis point to 1.654%.

Bond yields move inversely to prices.

U.S. stocks recorded their best week since October, with the S&P 500 (SPX) up 3.4% to 2,070.6 on the week. And the Dow Jones Industrial Average (DJI) rose 3% to 17,804.

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