After getting a bad start on a set of stronger-than-expected economic indicators Wednesday morning, Treasury prices managed to recover most of their losses during the shortened trading session.

By 1 p.m., eastern standard time, when the market closed early in honor of the Thanskgiving holiday, the 30-year bond was off 1/4 point to yield 7.96%. Right after the monring's data, the long bond had traded above 8%. Short-term noted ended slightly higher on the day.

Treasury prices declined even before the numbers were released because of reports that Congress might reconvene after Thanksgiving to work on a tax cut package. Market participants worry that Congress's efforts to stimulate the economy will run up the budget deficit and reignite inflation.

The market went still lower on the news that new jobless claims fell 80,000 in the week ended Nov. 16 and that October durable goods were up 3%. Economists had forecast a 47,000 decline in claims and a 1.3% increase in durable goods.

But prices soon bounced back. A government note trader said retail interest at the lowest price levels helped, especially at the short end.

"Buyers came in right away, and the market recaptured its losses," the trader said.

The news that Congress would adjourn until January also helped.

And economists said the early indicators were not as strong as they looked, while the second set of data at 10 a.m., EST, including the Chicago purchasing managers' November index and the October personal income and spending report, were favorable for the market.

"The so-called bright spots were not really bright spots, and the weak spots were clearly weak," said Joel Naroff, chief economist at First Fidelity Bancorporation in Philadelphia.

He said the increase in durables orders was all due to aircraft, which is a very volatile sector.

Meanwhile, the 0.2% increase in October personal income was the smallest since July and was due mostly to a rise in farm subsidies. Wage and salary income actually fell 0.2% during the month.

That weakness in income showed up on the consumption side -- October spending fell 0.3%, with the expected weakness in purchases of durables and an unexpectedly weak 0.1% rise in spending on services.

The October spending data suggest "the consumer is not going to be buying for a while," Mr. Naroff said.

He said that was a reasonable response to "the lack of job security that seems to exist. With people feeling that threat, it is a correct thing for them to stay very cautious."

In another sign of weakness, the Chicago purchasing managers' index fell to 53.2% from 56.3% of an unadjusted basis, suggesting the national purchasing managers' report Monday also will decline.

The Treasury market will be open for another shortened session today, but traders said activity would probably be very thin.

The December bond future contract closed 3/16 lower, at 99 12/32.

In the cash market, the 30-year 8% bond was 9/32 lower, at 100 9/32-100 13/32, to yield 7.69%.

The 7 1/2% 10-year note was unchanged, at 100 17/32-100 21/32, to yield 7.40%.

The three-year 6% note was up 1/32, at 100 17/32-100 19/32, to yield 5.77%.

Rates on Treasury bills were lower, with the three-month bill down one basis point at 4.39%, the six-month bill off two basis points at 4.59%, and the year bill one basis point lower at 4.50%.

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