Interest rates remained steady on Wednesday, as the government bond market held on to gains from earlier in the week.
At 4 p.m., the price of the Treasury's 30-year bond was up 3/32, to yield 6.09%, unchanged from Tuesday. The yield is down 10 basis points since last week and about 50 since last month.
Other Treasury coupon issues were mostly unchanged. Ten-year notes were up 1/32 in price, to yield 5.45%, unchanged. Five-year notes were off 1/32, to yield 4.80%, up from 4.78%. Analyst said the bond market is on hold in advance of Friday's August employment report.
"No one is willing to be a hero ahead of the employment report," said Steve Ricciuto, economist at Barclays de Zoete Wedd.
Most economists are predicting that employment grew at a sluggish pace last month, reflecting the economy's overall weakness. Estimates of nonfarm payroll growth range from a low of 40,000 jobs to a high of 150,000.
In July, nonfarm payrolls expanded by 160,000 jobs after a meager 44,000 gain in June.
All of Wednesday's economic news favored the bond market.
The National Association of Purchasing Management reported more sluggishness in the manufacturing sector. The association's closely watched index of economic activity fell to 49.3 from 49.5 in July.
A reading under 50 indicates economic decline. Further, the group's employment index dropped to 40.4 from 43.2. The August result was the lowest since 37.3 in May 1991.
Construction Spending Down
In other bearish news about the economy, the government reported that construction spending fell 0.5% in July and personal income dropped 0.2%. Economists had expected stronger numbers in both cases.
Stocks were mixed. The Dow Jones industrial average lost 6.15 points to 3,645. 10, and the Standard & Poor's 500 index fell 0.45 to 463.15. But the Nasdaq index gained 3.32 to 746.16.
The dollar finished in New York at 1.6593 German marks, down from 1.6765, and at 105.32 yen, up from 104.75.