Treasury Prices Mixes After 30-year Auction

STEPHEN BERNARD

NEW YORK (AP) — Long-term treasury prices finished Thursday moderately higher, recovering from a drop immediately following an auction of 30-year bonds. Prices for short-term Treasurys edged higher throughout the day.

Tom Porcelli, a market economist at RBC Capital markets, said results for the government's sale of $16 billion in 30-year bonds came in as expected. Investors bracing for weak demand avoided buying up the new debt, which in turn led to low actual demand, he said.

"In a lot of ways, it was a self-fulfilling prophecy," Porcelli said.

After an initial sell-off on the weak results, investors bought into the market, driving prices back to where they were before the details of the sale were announced Thursday afternoon.

The bid-to-cover ratio, which measures demand, was 2.26, compared with 2.37 and 2.92 at auctions in the previous two months for bonds with a similar maturity.

In late trading, the price of the 30-year bond rose 11/32 to 101 24/32, pushing its yield down to 4.39 percent from 4.41 percent late Tuesday. The Treasury bond market was closed Wednesday to observe the Veterans' Day holiday.