Yields on The Bond Buyer's weekly bond indexes declined again this week, despite a sharp market correction yesterday, as favorable fundamental and technical factors pushed prices higher for most of the week.

The 30-year revenue bond index reached yet another all-time low, falling 10 basis points, to 6.12% from 6.22% last week.

The daily Municipal Bond Index's average yield to par call was off six basis points, to 6.08% from 6.14% last Thursday. The yield to par call was up from an all-time low on Wednesday, when it touched 6.00%. The Bond Buyer began calculating the yield to par call on July 2, 1984.

The 20-bond and 11-bond indexes of general obligation yields both dropped 16 basis points, to 5.89% and 5.80%, respectively, from 6.04% and 5.96% last week. The 20-bond index is at its lowest level since April 27, 1978, when it was also 5.89%, and the 11-bond index has not been lower since July 5, 1979, when it was 5.80%.

Municipal prices rose more than two points on the week as investors continued to snap up bonds as soon as they became available. The Bond Buyer's estimated sales for the week rose above the $3 billion mark for the first time since the week of June 12. Standard & Poor Corp.'s The Blue List, which lists dealer inventories of unsold bonds, was a relatively paltry $747 million yesterday.

The market received a strong boost Tuesday when the Conference Board reported that its consumer confidence index plunged 11.6 points, to 61.1% in July, far below economists' expectations.

That drop especially benefited the Treasury market, pushing the 30-year yield below 7.50% for the first time since January. Government traders said the report compelled investors to move their funds into long-term, higher-yielding securities.

As of late yesterday afternoon, the 30-year Treasury bond's yield was down 10 basis points, to 7.43% from 7.53% last Thursday.

The municipal market's price gains began to slow Wednesday when the Treasury market retreated during the auction of $10.5 billion five-year notes.

"The reversal in the government market is making people nervous," a trader said. "We held our gains, but I wouldn't want to test that bid. The market is way up there, and we're due for a correction. We're on shaky ground right now."

The economy showed more strength than expected when the Labor Department reported that initial state unemployment insurance claims fell 21,000 in the week ended July 18, to a seasonally adjusted 400,000, the lowest level since Oct. 6, 1990. The Commerce Department reported, however, that second quarter real gross domestic product increased at an annual rate of 1.4% compared with a revised first-quarter rise of 2.9%.

Although the Treasury market regained most of yesterday's price declines by late afternoon, the initial drop sent a shiver through the municipal market. A trader said that a price correction was expected, but that investor demand would remain strong, especially at lower levels.

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