CREDIT : Bond Prices End Mixed in Light Trading

Bond prices were mixed Wednesday in light trading, with corporate and municipal issues up slightly and Treasury bonds lower.

The Treasury’s benchmark 30-year bond fell about 1/16 point, or about 62 cents per $1,000 in face value, while its yield finished unchanged at roughly 9.04%.

“There wasn’t any real economic news at all” to affect the market, said Arnold Moskowitz, senior vice president and economist at Dean Witter Reynolds Inc. “The only action was in the foreign exchange market, where the Fed was selling dollars for marks.”

The dollar fell slightly in foreign exchange trading.

In the secondary market for Treasury bonds, prices of short-term government issues were down from 1/32 point to 3/32 point, intermediate maturities fell from 1/32 point to 1/16 point, and long-term issues were down from 1/32 point to 3/32 point, according to Telerate Inc., a financial information service.

Industrials Higher

The movement of a point equals a change of $10 in the price of a bond with a $1,000 face value.

The Shearson Lehman Hutton daily Treasury bond index, which measures price movements on all outstanding Treasury issues with maturities of a year or longer, fell 0.86 to 1,127.84.

In corporate trading, industrials were up slightly. Moody’s investment grade corporate bond index, which measures price movements on 80 corporate bonds with maturities of five years or longer, rose 0.08 to 294.45.

In the tax-exempt market, the Bond Buyer index of 40 actively traded municipal bonds was up 1/8 point at 91.625 as of 3 p.m. EST. The average yield to maturity fell to 7.73% from 7.75% late Tuesday.

In Washington, yields on seven-year Treasury notes rose in Wednesday’s auction to the highest level in 15 months.

Fed Funds Rate Down

In the secondary market, yields on three-month Treasury bills fell to 8.52% as the discount fell 3 basis points to 8.24%. Yields on six-month bills fell to 8.88% as the discount fell 1 basis point to 8.40%. Yields on one-year bills were unchanged at 9.12% as the discount remained at 8.46%.

A basis point is one-hundredth of a percentage point. The yield is the annualized return on an investment in a Treasury bill. The discount is the percentage that bills are selling below the face value, which is paid at maturity.

The federal funds rate, the interest on overnight loans between banks, was quoted late in the day at 9%, down from 9.125% Tuesday.

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