Stocks turn down, U.S. yields touch new peaks By Reuters

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Stocks turn down, U.S. yields touch new peaks

Markets are awaiting more hints on the outlook for interest rates from policy makers when Fed officials and policy makers from the European Central Bank, the Bank of England and the Bank of Japan head to Jackson Hole, Wyoming, for their annual central bank conference later this week.

"There's a more cautiously optimistic mood across financial markets," said Fiona Cincotta, senior markets analyst at City Index in London."We had an optimistic July and now there's a realisation that what the Fed has been saying about higher rates for longer will ring true," she added, referring to the U.S. central bank.

Those fears of higher-for-longer interest rates and worries about China's faltering economy have recently sapped investor appetite for stocks before the Tuesday rebound. At the same time, however, inflation expectations have hardly budged - meaning"real" yields, which discount inflation expectations, have surged - a development likely to prompt investors to re-evaluate taking risks.

 

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