Bonds spike on job numbers

[notiCIas]

Bonds spike on job numbers

May jobs report misses estimates by a wide margin; 10-year yield falls to 3.83%.

June 3, 2005: 8:39 AM EDT

NEW YORK (CNN/Money) - Treasuy prices surged early Friday after a key reading on jobs came in well short of estimates.

The benchmark 10-year note jumped 20/32 of a point to 102-13/32 to yield 3.83 percent, down from 3.89 percent late Wednesday. The 30-year bond gained 1-9/32 to 118-1/32 to yield 4.17 percent, down from 4.23 percent Thursday. Bond prices and yields move in opposite directions.

May payrolls grew by 78,000, the government said Friday, well below the 175,000 consensus forecast of economists surveyed by Briefing.com.


Bonds have been rallying most of the week, with yields on the 10-year falling below 4 percent for the first time in 14 months.

The rally was sparked after the French rejected a referendum on a European Union constitution last weekend, which raised questions about the future of the EU and sent investors scurrying to US markets.

It continued Wednesday, after a key manufacturing report showed slowing industrial growth and inflation well contained.

Inflation hurts bonds at it erodes the value of the fixed interest-paying investment.