NEW YORK — Bond prices recovered Wednesday in light to moderate trading, following a steep decline prompted largely by concern about a flurry of new government issues coming into the market.
The Treasury's closely watched 30-year issue rose about 3/8 point, or $3.75 per every $1,000 in face value, after dropping about $13 Tuesday. Its yield, which moves inversely to its price, declined to 9.76% from 9.82% Tuesday.
Corporate and municipal bonds were 3/8 point lower to point higher.
After trading mostly lower through much of the day, analysts said bond prices rebounded when investors concluded that the sharp slide of recent days had gone too far.
"The market was simply oversold," said John Sebastian, executive vice president of Clayton Brown & Associates, a Chicago investment firm. "This was by no means a stampede; it was just a little bottom-fishing."
The federal funds rate, the interest on overnight loans between banks, was quoted late in the day at 7.50%, up from 7.375% Tuesday.