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Bond enjoys plate of data
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November 25, 1998: 9:17 a.m. ET
Strong signs on U.S. economy don't harm Treasurys ahead of early close
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NEW YORK (CNNfn) - A good-size helping of economic data didn't rattle U.S. Treasury prices Wednesday, as traders sent bonds up ahead of an early holiday break.
At around 9 a.m. ET, the 30-year benchmark Treasury issue was up 8/32 in price at 100-26/32, while the yield, which moves inversely, fell to 5.19 percent.
Bonds began to plow through a plate of economic reports - one hinting of a strong U.S. economy - with little difficulty.
Claims for jobless benefits last week came in at 300,000, according to the Labor Department. The figure was lower than expected - economists had forecast claims to reach 325,000.
Separately, October personal income inched up 0.4 percent on an annualized basis, in line with economist expectations. And personal spending rose 0.5 percent, a slightly lower-than-expected reading.
One analyst said the mixed bag of economic reports isn't decisive enough to cause Federal Reserve policy makers to cut interest rates when they meet next on Dec. 22.
"We are still seeing pockets of strength, and pockets of weakness, and while I don't think the Fed will move in December, I do think we will see further rate cuts in '99," said Michelle Laughlin, Treasury market strategist at Prudential Securities.
Bond traders were also awaiting a 10 a.m. report on existing home sales for October, which economists expected to rise to a rate of 4.75 million units on an annual basis.
The bond market is expected to close at 2:00 p.m. ET and will be closed for the Thanksgiving holiday Thursday.
Wednesday's cloudy picture for stocks, which seemed set for a slightly lower open based on early S&P Futures trading, could buoy bonds. Soaring gains on Wall Street have recently drained attention of a "safe haven" lure of bonds.
The dollar stabilized against the German mark after falling overnight due to a dip on Wall Street Tuesday. New thinking among currency traders is that a rate cut is more likely in Europe than the United States helped rally the dollar.
The dollar was off slightly at 1.7009 marks.
But the dollar was up modestly compared to the Japanese yen, at 121.64 yen, amid lingering doubts about prospects for a consumption tax in Japan.
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