Treasuries Bolt Higher

The bond market was lifted in expectations the Fed will again cut rates sharply on Tuesday

Treasuries were higher Monday despite strength in stocks. The bond market was lifted in expectations the Fed will again cut rates sharply on Tuesday. The 30-year bond was outperforming in the wake of another spate of gloomy economic data after last week's severe correction.

Yet another grim piece of economic news was released Monday. A key barometer of business activity in services and other sectors declined sharply in October after the terrorist attacks on New York and Washington. The National Association of Purchasing Managers' non-manufacturing index fell to 40.6 in Oct from 50.2 in September. Any number below 50 represents a contraction. The index was well below its six-month average of 47.3 with weakness widespread, particularly in the communication, wholesale trade, agriculture, transportation and construction sectors.

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