Bonds hold steady, dollar mixed

NEW YORK (CNNMoney.com) -- Bonds held steady Tuesday morning amid concerns about the effect subprime loans fallout could have on the economy. The dollar weakened against the euro and gained against the yen.

The benchmark 10-year note bumped up 1/32, or 31 cents on a $1,000 note, to yield 4.603 percent, up slightly from 4.60 percent Monday.

The 30-year note also increased 1/32, or 31 cents on a $1,000 note, to yield 4.803 percent, up from 4.79 the previous session. Bond prices and yields move in opposite directions.

The five-year note was unchanged, yielding 4.492 percent. The one-year note was also unchanged, yielding 4.586 percent.

The market is girding for more subprime woes Tuesday. Embattled subprime mortgage lender New Century Financial is widely expected to file for bankruptcy soon.

Morgan Stanley (Charts) said Monday it would auction nearly $2.5 billion in residential mortgages from the subprime mortgage lender.

Defaults in the subprime mortgage sector, which give home loans to borrowers with poor credit histories, have been rising as home prices have fallen and sales have slowed, sending jitters throughout the equities market.

Investors will be looking for direction from the Conference Board's March report on consumer confidence, due at 10 a.m. ET.

The reading will be the first look at how consumers are weathering the recent market selloff and woes in the subprime mortgage sector.

Economists surveyed by Briefing.com expect the index slipped to 109 in March from 112.5 in February. With the consumer confidence report the only release on the economic calendar, stocks could be in for another day of choppy trading, which could help bonds.

In currency trading, the euro bought $1.3343, up from $1.3329 Monday, while the dollar bought ¥118.17, up from ¥118.08 in the last session.

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