WASHINGTON Treasury security prices fell across the board yesterday as traders realized that the same old questions about future inflation are still dogging the market despite last week's rally induced by falling stock prices.
The long bond was quoted down 17/32 late yesterday at a price of 94 14/32. pushing the yield up to 7.99%. The 10-year note also fell 17 ticks to par and a 7.87% yield.
Meanwhile, yields on three-month and six-month bills climbed about 10 basis points to 5.55% and 6.10%, respectively.
The Dow Jones industfi~ average ended the day more than 31 points higher, after heavy losses last week.
"Near-term support of plunging equity prices fell by the board," said Kevin Ftanagan, a vice president at Dean Witter Reynolds Inc. "The market is revisiting fundamental questions."
Yesterday's dec~e in Treasury prices came despite a resilient dollar. Reports of strong retail sales this weekend coupled with a slew of important economic reports due out later this week, including the November employment report, injected a dose of reality into the market, analysts noted.
"There was a lack of investor commitment," said Lawrence Waldorf, a portfolio manager at First Investors Asset Management. "Stories of robust Christmas sales allowed the bears to come out of hiding."
