CREDIT : Bond Prices Continue to Head Down
Bond prices fell slightly Monday, extending Friday’s steep selloff that had been triggered by an unexpectedly strong employment report.
The Treasury’s benchmark 30-year bond fell 3/16 point, or $1.88 per $1,000 face amount, while its yield, which moves in the opposite direction from its price, rose to 9.16% from 9.14% on Friday.
On Friday, the long bond fell 3/4 point after the Labor Department said the civilian unemployment rate fell to 5.1% in February, its lowest point in 15 years.
There was no fresh news to move the market in either direction Monday, said Steven J. Hueglin, an executive vice president of the investment firm Gabriele, Hueglin & Cashman.
“You have these days of very frenetic activity (like Friday) and then they’re followed by periods of very quiet trading,” said Nicholas Marrone, a government securities trader at Carroll McEntee & McGinley Inc.
In the secondary market for Treasury bonds, prices of short-term governments fell 1/32 point to 1/16 point, intermediate maturities fell 1/16 to 3/32 point and long-term issues fell 5/32 point to 1/4 point, according to Telerate Inc., a financial information service.
The movement of a point is equivalent to 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 0.24 to 1,118.59.
In corporate trading, industrials slipped. Moody’s investment grade corporate bond index, which measures price movements on 80 corporate bonds with maturities of five years or longer, fell 0.06 to 298.06.
In the tax-exempt market, the Bond Buyer index of 40 actively traded municipal bonds fell 1/8 point. The average yield to maturity rose to 7.73% from 7.72% late Friday.
The federal funds rate, the interest on overnight loans between banks, was quoted at 9.75%, unchanged from late Friday.
Tables, Page 18