Treasuries have moved to the upside in morning trading Friday, with some traders moving their money out of stocks and into bonds. With the upward move, treasuries are adding to the gains posted in the previous session.

The benchmark ten-year note is seeing modest strength, although it currently remains above the unchanged line. Subsequently, the yield on the ten-year note is currently down less than a basis point at 2.726 percent.

The strength among treasuries comes as stocks are moving mostly lower after trending higher in recent sessions, with traders doing some profit taking. The Dow is currently down more than 100 points after ending Thursday's trading at a one-month closing high.

Treasuries are adding to the gains posted in the previous session, which came after the Treasury Department revealed strong demand for its auction of $24 billion worth of seven-year notes.

The seven-year note auction drew a yield of 2.384 percent and a bid-to-cover ratio of 2.52. The bid-to-cover ratio, an indicator of demand, came in well above the 2.11 reported for the previous auction of $22 billion worth of seven-year notes last month.

On the economic front, personal spending increased in the first two months of the year, according to a report released by the Commerce Department on Friday, with the two consecutive months of growth following six straight months of declines.

The report showed that personal spending rose 0.2 percent in February, with the increase coming in line with economist estimates. The modest increase followed an upwardly revised 1.0 percent increase in January, which compares to the previously reported 0.6 percent growth.

At the same time, the Commerce Department said that personal income edged down 0.2 in February after a downwardly revised 0.2 percent increase in the previous month. Economists had been expecting a slightly more modest 0.1 percent decrease.

With personal spending rising and personal income falling, personal saving as a percentage of disposable personal income was 4.2 percent in February compared with 4.4 percent in January.

Meanwhile, the final reading of the Reuters/University of Michigan's consumer sentiment index for March is due to be released at about 10 am ET. Economists expect the consumer sentiment index to be revised up to 56.8 from the mid-month reading of 56.6.

Consumer spending and attitudes are a significant factor for investors, as they are good barometer of upcoming economic activity.

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