Uncle Sam comes out a winner in Tuesday’s market mess

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The Obama administration may have lost some credibility with the stock market on Tuesday, but that just helped the government’s cause in the bond market.

The rush out of stocks, on apparent disappointment over the lack of details in the administration’s new financial-system rescue plan, helped stoke demand for Treasury bonds as a haven.

It just so happens that the Treasury is needy for bond buyers this week, as it sells a record $67 billion in three-year, 10-year and 30-year securities.

The first part of the sale -- $32 billion in three-year notes -- went well Tuesday. Investors put in a total of $85.5 billion in bids for the securities.

The annualized yield on the notes was 1.42%, below the 1.47% that traders had expected, according to a Bloomberg News survey.

Yields also fell on longer-term issues. The 10-year T-note yield slid to 2.84% from 3.02% on Monday. The decline in market rates may help as the Treasury auctions $21 billion in 10-year notes on Wednesday and $14 billion in 30-year bonds on Thursday.

Treasury yields had been rising since mid-January, partly because investors were finding more appealing -- and riskier -- places to put their money, including stocks.

On Tuesday, risk-taking once again gave way to the just-find-me-a-place-to-hide mentality that is the Treasury market’s best friend.

-- Tom Petruno