|Bid||119.75 x 1800|
|Ask||119.90 x 1300|
|Day's Range||119.47 - 119.83|
|52 Week Range||116.09 - 129.57|
|PE Ratio (TTM)||N/A|
|Expense Ratio (net)||0.15%|
Government bonds and Treasury-related exchange traded funds continued to strengthen Friday as fearful investors turn to safe-haven assets. On Friday, the PIMCO 25+ Year Zero Coupon US Treasury Index ETF ...
After surging to six-month high price levels on Wednesday, the US Dollar Index pulled back on Thursday amid weak market sentiment. However, the US Dollar Index opened May 25 on a stable note. The index was trading above opening prices in the early hours.
In its meeting, the FOMC indicated that US financial market volatility had increased since its last meeting in March. Members felt that low-volatility (VXX) strategies had been less prevalent in February, leading to market turmoil. The May meeting minutes indicated that members felt that US financial conditions had somewhat tightened in the inter-meeting period but that they remained accommodative—a signal that members were comfortable with the further tightening of financial conditions.
In a classic Donald Trump move, the president wrote a letter to North Korean leader Kim Jong-un to cancel their planned meeting in Singapore next month. Trump wrote, “Sadly, based on the tremendous anger and open hostility displayed in your most recent statement, I feel it would be inappropriate, at this time, to have this long-planned meeting.” This meeting was seen as an unprecedented attempt to dissolve tensions between the United States and North Korea, which could have reduced geopolitical risks. The SPDR Gold Shares ETF (GLD), which tracks physical gold, on the other hand, was trading up 1.03%.
After a brief pullback on Tuesday, the US Dollar Index regained strength on Wednesday and surged to five-month high price levels. The US Dollar Index opened Thursday on a mixed note and traded with weakness in the early hours.
In early April, I outlined the case for a longer-term bear market for bonds. Years ago, a veteran bond trader observed that rate bear markets tended to run from 21 to 36 years. Note that a mirror-image reflection has unfolded.
China invests the trade surplus it has with its trading partners in US government securities (GOVT). According to the data available from the US Treasury, China owns close to 20% of total outstanding US debt, and the total value of these securities is close to $1.2 trillion.
After closing higher last week, the US Dollar Index started this week on a mixed note and traded with mixed sentiment in the first two trading days. The US Dollar Index opened Wednesday on a stronger note and was trading at 2018 highs in the early hours.
A longtime business partner of President Donald Trump's personal lawyer Michael Cohen, whose business dealings are being scrutinized by federal prosecutors, pleaded guilty on Tuesday in a state tax fraud case that requires him to cooperate in any ongoing investigation, according to a person briefed on the deal. Yellow cab magnate Evgeny "Gene" Freidman, the so-called Taxi King of New York, pleaded guilty to a single count of tax fraud in an Albany courthouse, almost a year after state prosecutors and tax authorities charged him with pocketing $5 million in mandatory, per-ride transportation fees. For years, Freidman has managed hundreds of taxi medallions, the physical plates affixed to cabs that owners are required to display, including more than two dozen owned by Cohen, Trump's longtime fixer.
Following a strong performance last week, the US Dollar Index started this week on a mixed note by trading with increased volatility on Monday. On May 22, the US Dollar Index started on a mixed note and traded with weakness in the early hours.
The US bond markets remained under selling pressure as bond yields, especially at the short end of the curve, continued to shoot up, while the long-term yields remained subdued. The US Fed through its May post-meeting statement said that inflation would reach the 2% target soon, which was interpreted as a signal for a faster pace of rate hikes. An inverted yield curve, where short-term (SHY) yields are higher than long-term yields (TLT) is considered a warning sign for future recessions, and thus the yield spread has a place in the leading economic index.
The US Dollar Index regained strength and gained in all of the trading days last week. Carrying forward the strength, the US Dollar Index opened higher on Monday. In the early hours, the US Dollar Index was trading at the highest levels traded since December 2017.
US ten-year bond market yields have scaled a new seven-year peak at 3.07, their highest level since July 2011. This 100-basis-point move, which happened over the span of a little over eight months, has taken its toll on bond prices. Thanks to rising crude prices, increased chances of higher inflation have been fueling the recent rally in rates.
After closing last week almost flat, the US Dollar Index started this week on a stronger note and gained in the first four trading days of the week. On Friday, the US Dollar Index opened the day on a stable note and consolidated at five-month high price levels in the early hours.
The US Dollar Index started this week on a stable note and gained in the first two trading days of the week. Following a brief pullback on Wednesday, the US Dollar Index opened stronger on May 17 and traded with strength at the highest levels traded since December 2017.
As I wrote this past weekend: "Predicting the Future is an Overrated Trading Strategy". Ironically negative news like trade wars often ends up being a positive catalyst. President Trump has a pattern of making very aggressive decisions and then backing off which causes a positive market reaction.
US bond market yields continue to trend higher, but their overall movement last week was limited. Despite this limited movement, a few takeaways from the week hint at how interesting the bond markets could get in the future. The market’s reaction can be interpreted as investors seeing that the Federal Reserve will stick to its tightening stance in the future and that a change in inflation expectations will drive bond yields.
In this time of uncertainty surrounding the path of interest rates, floating rate bonds can be a good way to reduce benefit from interest rate hikes, without giving up much income today. Three-month LIBOR, the benchmark rate for most FRNs, is at 2.34%, which is high, by historical standards, versus other short-term rates like three-month T-Bills. You could buy bonds of individual companies, though you then need to do the credit work.
Yahoo Finance's Alexis Christoforous and Jared Blikre break down the latest market action.
Alan Valdes, director of floor operations at Silverbear Capital, joins Yahoo Finance's Seana Smith from the New York Stock Exchange to discuss the latest market moves as the Federal Reserve releases the minutes from the last FOMC meeting.