Weak Production Data Boosts Bonds

Treasuries also rose amid a tech-stock plunge following Nortel's earnings warning

Treasuries closed a whippy, holiday-shortened session at the day's highs, led by a safe-haven rally in the short end. The two-year note shed more than 13 basis points on the day as a plunge in equities, weaker consumer sentiment data, and the news of an U.S. and British air strike on Iraq sent cash flowing into the safety of Treasuries.

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