Treasury yields advanced while stocks in Asia traded mixed as investors braced for a further market downturn on China’s woes and more policy tightening globally. Yields climbed across tenors, bringing the 10-year’s back on its path toward the highest level since November 2007 and the 30-year’s near 2011 highs, as selloff in the Treasury market this month wiped out what was left of year-to-date gains.
It also reduced its 12-month index target from 70 to 67, implying 13% returns over the next 12 months. “Until more forceful policy responses are made available to backstop the contagion risk, we believe Chinese stocks will settle in a lower trading range than we previously envisaged,” Goldman equity strategists, including Kinger Lau and Timothy Moe, wrote in a note. Meanwhile, the offshore yuan fell against the greenback.