FINANCIAL MARKETS : CREDIT : Bond Prices Mixed as Market Calms
Bond prices finished mixed Friday, stabilizing after a selloff on Thursday. The Treasury’s benchmark 30-year bond fell 1/16 point, or 63 cents per $1,000 face amount. Its yield inched up to 8.93% from 8.92% on Thursday.
Yields finished the week at their highest levels in three months, and up from 8.79% a week ago.
Trading was quiet Friday in the absence of fresh developments in the Persian Gulf standoff between Iraq and a multinational force led by the United States.
But some dealers capitalized on the low prices to buy, said Bruce R. Lakefield, executive vice president with Shearson Lehman Government Securities. Traders also bought bonds to cover short positions.
The federal funds rate, the rate banks charge each other on overnight loans, was quoted at 7.75%, down from 8.125% on Thursday.
CURRENCY
Dollar Falls Again onEconomic Gloom The dollar sank to another all-time low Friday against the German mark and fell against most other currencies, reflecting continuing pessimism about the state of the U.S. economy.
The dollar fell to a record low close of 1.5485 German marks in Europe from 1.5630 late Thursday. Its previous low close in Europe was 1.560 marks Wednesday.
In New York, the dollar ended at 1.550 marks, a new low for that market. Its previous low close in New York was 1.552 on Thursday.
For the week, the dollar sank 6.7% against the mark.
Against the Japanese yen, the dollar edged up to 147.60 from 147.25 on Thursday.
Other late dollar rates in New York, compared to late rates Thursday: 1.2820 Swiss francs, down from 1.2915; 5.1975 French francs, down from 5.2220; 1,142.25 Italian lire, down from 1,143.25, and 1.14365 Canadian dollars, down from 1.14815.
COMMODITIES
Gold Mixed in U.S. After Foreign Rally Gold prices were mixed in New York, after rising overseas. On the Commodity Exchange, gold for current delivery rose 40 cents to $409.60 an ounce.
Silver for current delivery rose 1.1 cents to $5.18 an ounce on the Comex.
The metals’ muted gains were in sharp contrast to another leap in the price of oil, up $1.27 to $28.63 a barrel for West Texas Intermediate for September delivery.
Elsewhere, analysts predicted a sharp drop in cattle futures prices after a government report showed that far more cattle were placed on feedlots last month than the market had expected.
An anticipated drop of at least a penny a pound would extend losses posted on the Chicago Mercantile Exchange ahead of the report.
On other commodity markets Friday, pork futures were mixed, oil and gasoline futures skyrocketed, precious metals rose, and grains and soybeans were mixed.
Live cattle futures settled .20 to .57 cents lower in Chicago, with the contract for delivery in August at 77.90 cents a pound; feeder cattle were unchanged to .67 cents lower, with August at 89.65 cents a pound; live hogs were unchanged to .35 cents lower, with August at 57.52 cents a pound, and frozen pork bellies were .83 cents lower to 1.17 cents higher, with August at 48.12 cents a pound.
In a report released after the close of trading, the Agriculture Department said 7 million cattle were on U.S. feedlots Aug. 1--4% more than a year ago.
The USDA said July feedlot placements were 18% higher than a year ago, while July marketings off feedlots rose 3%.
Analysts were surprised by the placements figure, which compared with expectations of a 6% increase.
Corn and soybean futures rose but wheat ended lower on the Chicago Board of Trade after a day of choppy trading in the absence of fresh supply-and-demand developments.
