Treasuries Modestly Higher

The market staged a partial recovery from Wednesday's selloff in a quiet post-holiday session

Treasuries posted modest gains late in Friday's holiday-shortened session, correcting higher on short covering and bottom fishing after Wednesday's debacle. The post-Thanksgiving Day trade in the bond market was predictably quiet.

Longer dated instruments generally outperformed, helped by some month-end demand. There was nothing to provide any excitement. The data and events calendars were empty. Wall Street was quiet, and corporate and government issuance took a breather.

Next week should offer plenty of excitement, however. December kicks off with the ISM release on Monday, along with auto sales. The ISM-nonmanufacturing index will be reported on Wednesday. Industrial production and capacity utilization revisions will be reported on Thursday.

All of these will set the stage for Friday's payroll report. While most of the data should support rising expectations on the economy, the payroll report could be a wildcard. MMS expects payrolls to rise 65K in November; the MMS Survey median suggests only a 25K gain.

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