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Bonds regain momentum
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August 30, 2000: 3:21 p.m. ET
Month-end index buying boosts prices; euro steady ahead of ECB meeting
By Staff Writer Jill Bebar
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NEW YORK (CNNfn) - Treasury bonds ended slightly higher Wednesday, recovering from earlier losses as month-end index buying by portfolio managers lifted prices.
The euro was steady against the dollar ahead of a European Central Bank policy meeting.
Shortly after 3 p.m. ET, the benchmark 10-year Treasury note rose 2/32 of a point in price to 99-19/32. The yield fell to 5.80 percent from 5.81 percent Tuesday, as yields move inversely to price.
The 30-year bond gained 6/32 to 107-7/32, its yield retreating to 5.73  percent from 5.75 percent.
The market benefited from month-end index buying. During the course of the month, the benchmark indexes are adjusted to reflect the removal and addition of various fixed income securities.
As a result, managers whose funds mirror these indexes bought securities, particularly longer-term issues, at month's end to reflect those changes.
Treasurys fell sharply the previous two sessions amid overbought conditions and expectations of a heavy amount of corporate debt sales in September.
Investors remained focused on two upcoming economic reports. Both the August employment report and the National Association of Purchasing Management's (NAPM) survey of manufacturing activity are scheduled for release Friday.
Investors shrugged off the latest economic news. Leading indicators fell 0.1 percent in July, the Conference Board reported.
Euro recovers
The euro recovered from session lows, propelled higher against both the dollar and the yen amid rumors that monetary officials were "checking" rates as a prelude to possibly intervening in the currency markets.
In overnight trading, the single currency fell to 88.70 cents, just above its record low of 88.45 cents on May 4.
As a way of expressing concern about a currency without actually  intervening, monetary officials will call banks to check rate levels in order to help them to assess the market.
Traders await the outcome of Thursday's European Central Bank policy meeting. There is widespread belief the central bank will hike rates by at least a quarter-percentage point.
Early in the day, the dollar hit a new seven-year high against the British pound at $1.4423.
Shortly after 3 p.m. ET, the euro traded at 89.25 cents compared with 89.27 cents Tuesday. The dollar was buying 106.41 yen, up from 106.11 yen Tuesday. And the British pound traded at $1.4570. 
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