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Oil slump lifts Treasurys
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September 8, 2000: 3:18 p.m. ET
Bonds benefit from declining oil, weak stocks; dollar gains vs. yen, euro
By Staff Writer Jill Bebar
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NEW YORK (CNNfn) - Treasury bonds advanced Friday, buoyed by a sharp decline in oil prices and weakness among U.S. equities.
In the foreign exchange market, the dollar moved higher against both the yen and the euro.
Shortly before 3 p.m. ET, the benchmark 10-year Treasury note rose 4/32 of a point in price to 100-3/32. The yield fell to 5.73 percent from 5.75 percent Thursday, as yields move inversely to price.
The 30-year bond gained 8/32 to 107-26/32, its yield retreating to 5.69  percent from 5.72 percent.
In a holiday-shortened week void of any significant economic data, Treasurys regained momentum as oil prices retreated from recent lofty levels ahead of Sunday's OPEC meeting. In late trading, U.S. light sweet crude futures for October delivery fell $1.77 to $34.62 a barrel.
"Oil prices are getting hammered, and that's helping Treasury prices," said Mike Mauer, debt strategist at A.G. Edwards.
Rising oil prices pose the risk of inflation, which is negative for bonds.
Treasurys also benefited from a slump in stocks, particularly technology shares, with the Nasdaq composite index declining more than 2 percent in late trade.  Investors often flee a plunging stock market for the relative safety of government securities.
Looking ahead, the market faces some key economic news next week, including August reports on producer prices and retail sales Thursday and consumer prices Friday.
Analysts expect the inflation data to be benign, as the recent round of high energy prices has yet to work its way into the economy.
(Click here for a look at Briefing.com's economic calendar.)
Dollar climbs
The dollar rose sharply against the yen Friday after Moody's Investor Service downgraded Japan's sovereign debt rating to Aa2, its third-highest rating, from Aa1.
Currency traders await Monday's second-quarter gross domestic product report, the key release out of Japan next week. 
Meanwhile, a renewed bout of weakness in the euro sent it just above its record low of 86.30 cents hit in the prior session.
Analysts say Europe's common currency will remain vulnerable. Euro-zone finance ministers meeting in France this weekend are expected to express concern about the euro, but government intervention to support the currency is unlikely.
Shortly before 3 p.m. ET, the dollar traded at 106.11 yen, up from 105.15 yen Thursday, a 0.9 percent gain in the dollar's value. The euro was buying 86.97 cents compared with 87.24 cents Thursday. 
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