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Treasury prices rose, pulling yields lower, Wednesday after Turkey slapped import levies on U.S. imports, bringing geopolitical ructions between the U.S and its allies back on investors’ radars.
The U.S. yield curve’s torrid run toward inversion remains squarely on track as investors seemingly take advantage of any steepening to pile further into the flattener trade. The spread between 2- and 10-year Treasury yields on Wednesday narrowed to the least since August 2007 as traders continue to crush a brief bout of steepening seen in the past month. Concern that Turkey-induced turmoil spreading across emerging markets could spark global contagion hasn’t derailed investors’ expectations that the Federal Reserve will keep tightening monetary policy, driving shorter-dated U.S. yields higher.
A slide in long-dated Treasury yields Wednesday helped to flatten the yield curve, leaving the spread between the 2-year note and the 10-year note at its narrowest since 2007. The 10-year Treasury note yield (tmubmusd10y) fell 4.4 basis points to 2.851%, while the 2-year note yield (tmubmusd02y) slipped 3.3 basis points to 2.600%, according to Tradeweb data.
TOKYO (AP) — Asian shares fell Thursday after deepening worries about global economic growth, particularly in China, set off a rout on Wall Street.
MARKET PULSE U.S. stock benchmarks early Wednesday traded lower as fears about the health of the Turkish economy weighed on the broader market. The Dow Jones Industrial Average (dJIA) fell 148 points, or 0.
The yield on the 10-year U.S. Treasury note yield has risen 49 basis points since the beginning of the year to 2.90 percent, and the 30-year bond yield has jumped 33 basis points to 3.07 percent. Blame the tax cuts. Despite data showing that gross domestic product grew at a 4.1 percent annual rate last quarter, most forecasters expect the resulting huge federal deficits and Treasury borrowing to pay for the lost revenue from reduced corporate taxes to slow growth.
As concerns surrounding the future of Turkey's economy and the U.S.' trade ties with major economies continue to rattle investors, Wednesday will mark the day when a slew of economic data is due. At 7 a.m. ET, the routine weekly mortgage applications are due, followed by retail sales, the Empire State Manufacturing survey, and productivity & costs, which are all released at 8:30 a.m. ET. The yield on the benchmark 10-year Treasury note was lower at around 2.884 percent at 5:55 a.m. ET, while the yield on the 30-year Treasury bond was in the red at 3.049 percent.
Asian stocks retreated to a one-year low on Wednesday as bearish Chinese markets worsened investor sentiment already hurt by Turkey's financial crisis. Spreadbetters expected European stocks to open slightly higher, with Britain's FTSE seen rising 0.2 percent, Germany's DAX adding 0.1 percent and France's CAC gaining 0.15 percent. MSCI's broadest index of Asia-Pacific shares outside Japan slid more than 1 percent to its lowest since August 2017, after bouncing 0.4 percent the previous day when the Turkish lira showed signs of stabilising.
Asian stocks retreated on Wednesday, failing to follow Wall Street's gains, while the dollar was near a 13-month high as concerns about Turkey's financial crisis weighed on investor appetite despite the lira's move away from an all-time low. The lira --which plummeted to a record low of 7.24 to the dollar at the week's start, rattling global markets-- was slightly weaker at 6.415 after rebounding more than 8 percent overnight. Wall Street's three main indexes rose on Tuesday as the lira's climb eased fears of broader financial contagion for now.
U.S. stocks rallied Tuesday as banks, retailers, and smaller companies jumped. The Turkish lira steadied as officials from Turkey and the U.S. said the countries are in talks to ease diplomatic tensions, which have resulted in high tariffs on Turkish steel and aluminum. Stocks in emerging markets like Argentina, Russia and Brazil jumped.
U.S. government bonds fell Monday as investors are increasingly speculating that the crisis in Turkey will be contained. Yields climbed as some investors saw limited potential harm to the U.S. economy from the economic and diplomatic turmoil in Turkey, which has caused its currency to plunge and yields on its bonds to jump. As Turkey’s economy has slowed and inflation has risen, officials have pursued policies intended to spur the pace of growth, while the central bank has declined the opportunity to raise interest rates.
said recently that the U.S. 10-year Treasury yield "should be 4% today, [and] you better be prepared to deal with rates of 5% or higher -- it's a higher probability than most people think." Is America's most famous banker right ... and if so, how should smart investors play this? After all, no one will clamor for a stock with a 3.6% dividend when the U.S. Treasury will pay you 5% for your money. JPMorgan currently trades at less than 12 times forward earnings.
U.S. government bonds yields on Monday hold near their lowest levels since the middle of July amid a swoon in Turkey’s lira which has fueled risk-off buying of haven Treasurys since Friday, driving yields south.
U.S. Treasury yields recovered from four-week lows on Monday, with concerns about the global impact of the Turkish crisis easing somewhat after the country's central bank came out with measures to stabilize ...
Indeed, expectations for inflation over the next ten years, derived from 10-year Treasury inflation-protected securities, or TIPs, have barely budged from a 2.1% rate even after the core July consumer-price index, which strips out volatile food and energy prices, came in at 2.4% year over year, the fastest since September 2008. “A collective unwillingness to look beyond the CPI release speaks to our ‘too little, too late’ take on any late-cycle spike in consumer prices,” said Ian Lyngen, head of U.S. rates strategy at BMO Capital Markets, in a Monday research note.
Since the 2008 crisis, two traditional weathervanes of investors’ hopes and fears have struggled to retain their predictive credibility: equity risk premium (ERP) and the yield curve. Quantitative easing by central banks has been widely singled out as the main culprit. ERP measures the additional rate of return that investors require to compensate them for the risk of holding stocks instead of a ‘risk-free’ asset, typically the US 10-year Treasury Bond or six-month Treasury note.
Rates for home loans ticked down, offering some relief to home buyers, but housing market headwinds have left too many of them “fatigued,” in the words of one lender.
U.S. government bond prices rose Friday after continued economic uncertainty in Turkey—and the fear of a ripple effect across other markets—pushed investors to the relative safety of Treasury debt. The yield on the benchmark 10-year Treasury posted its biggest one-day drop since May 29, settling at 2.859%, compared with 2.935% Thursday. Yields fell as the Turkish lira continued its steep descent Friday, pushing the dollar to its highest level in more than a year.
NEW YORK (AP) — Stocks in the U.S. and Europe skidded Friday as investors worried about the financial stability of Turkey and how it might affect the global banking system.
U.S. government bonds rally Friday, driving yields to their sharpest yield decline since late May as turmoil in Europe, sparked by questions about a knock-on effect from economic distress in Turkey, rattles investors’ sentiment and sent them fleeing to the perceived safety of sovereign paper.
Speculators' net bearish bets on U.S. 10-year Treasury note futures slipped from an all-time high earlier this week before the Treasury's record offering of 10-year debt, according to Commodity Futures ...