|Bid||118.09 x 5300|
|Ask||118.15 x 4800|
|Day's Range||118.34 - 119.21|
|52 Week Range||116.49 - 129.57|
|PE Ratio (TTM)||N/A|
|Expense Ratio (net)||0.15%|
Keith Bliss of Cuttone and Company joins Yahoo Finance's Seana Smith from the floor of the New York Stock Exchange to discuss Bank of America Merrill Lynch's newly released Global Fund Manager Survey for January.
February has been an awful month on Wall Street. In fact, if you look at the Market-Based Probabilities chart from the Federal Reserve Bank of Minneapolis in Fig. 1, you will see that after all of the volatility the market has been experiencing during the past two weeks, Wall Street is only pricing in a 12% chance of a decrease of 20% or more in the stock market during the next 12 months. This is a much lower level than the 17% chance Wall Street priced in during January of 2016 when stocks were testing multiyear lows or the 24% chance of a decline Wall Street priced in during September of 2011 when Congress failed to raise the debt ceiling and threatened to default on U.S. debt.
Markets were gripped with anxiety before the January inflation report was published on February 14. The inflation report was the focus for investors who have grappled with two weeks of panic selling. The anxiety was due to fear about the possibility of a faster rate hike pace from the Fed, which could increase funding costs for companies and increase bond yields (TLT) across the board.
For years, the Fed has been trying to revive inflation under the theory that rising prices will encourage economic growth. But so far, all of their efforts, and trillions of dollars of artificial credit, have not worked. Will that change now with the new economic policies from the White House?
Because rising interest rates is one of the culprits spooking investors, equities and fixed income have been falling hand-in-hand. Like a millstone around the neck, the specter of higher rates continues to drag bond prices into the depths.
Stocks are suffering another bout of volatility on Thursday, with the Dow Jones Industrial Average falling to test the lows seen on Tuesday as bond yields keep drifting higher. Financial conditions remain easy. Keep an eye on these five charts as stocks endure the drama.
By Justin Sibears, Newfound Research This post ended up being more timely than we could have ever imagined as Credit Suisse announced that it would accelerate XIV’s maturity after the ETN lost more than ...
Bad news is supposed to be good news for the bond market, but this week's news apparently hasn't been bad enough to set off a stampede at today's auction of 10-year Treasury notes. The relatively tepid demand--which coincides with news of a proposed Washington deal that would push up spending caps by an additional $300 billion over two years is pushing up bond yields. The notes were awarded at 2.811%, a bit higher yield (lower price) than the 2.80% when-issued trading at the 1 PM EST auction time, notes Peter Boockvar, chief market strategist at Bleakley Advisory Group.
What Triggered the Stock Market Panic This Month? Since the onset of the current euphoric rise in stock prices after the US elections, the bond markets have remained somewhat muted. Until recently, the ten-year bond yields have been hovering near the 2.5% mark, around 20 basis points higher than the 2016 average of 2.3%.
The recent rout in the equity market was fueled by concerns over rising interest rates, which could increase costs for the industry. Investor anxiety about rising rates was triggered by comments from San Francisco Fed president John Williams on Friday, February 2. During his speech, Williams said he envisioned three or four hikes this year, and investor anxiety escalated further after the non-farm payrolls report indicated impressive job gains in January.
The US bond market’s (BND) troubles escalated last week as inflation expectations continued to rise. The first reason was the January FOMC (Federal Open Market Committee) meeting. The Fed left interest rates unchanged at that meeting but changed its outlook on inflation, saying that inflation (TIP) could pick up and stay near the 2% target.
Friday started with good news—a better than expected jobs report—that was bad news for the bond market. Bond prices, which move inversely to their yields, fell fast in the morning, while the yield on the 10-year Treasury Note hit a four-year high of 2.84%. Yields have been heading higher for weeks, but the jobs report appears to have accelerated the anxiety in the market.
The FOMC, through its implementation note released with the January statement, announced its decision to allow the open market desk at the Federal Reserve Bank of New York to increase the amount of Treasury (GOVT) securities that are being allowed to expire without rolling over every month. The exercise of trimming the Fed’s balance sheet was taken up to offload the huge amount of Treasury securities that the Fed amassed over the last decade through its QE (quantitative easing) programs 1, 2, and 3.
What Boosted the Leading Economic Index in 2017? The Conference Board LEI (Leading Economic Index) is expected to use only forward-looking indicators in its economic model, but there’s one exception to this condition. The consumer expectation for business conditions is derived using expectations, rather than any economic indicator.
What Boosted the Leading Economic Index in 2017? In its December meeting, the US Federal Reserve increased the federal funds rate by 0.25%, just as markets expected. This led to the narrowing of credit spreads between long-term and short-term yields, resulting in a flattening yield curve.