Bonds are reflecting doubt about a trade deal, yields fell quickly and 'trade more like stocks'

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A quick reversal in the bond market shows how easily investors can be spooked by doubts about a trade deal.

"A lot of the move we saw last week was trade optimism. If that trade optimism is unfounded, it makes some sense you take some of that optimism out," said Jon Hill, fixed income strategist at BMO.between Trump and China President Xi Jinping, but so far no meeting has been announced. Instead, reports have surfaced that the two sides are in disagreement over China's desire to see existing tariffs lifted.

Goldman Sachs strategists see scope for a higher 10-year yield but how high depends on the type of trade deal. Increases will also be curbed by the fact central banks are unlikely to raise interest rates. Some strategists have said yields are in an uptrend. "Our positioning metrics suggest risk of a near term selloff — this is particularly likely on positive catalysts, such as tariff rollbacks. Other risks include spillovers from a strong environment outside the US. However, we would view large selloffs driven by either of these factors as a tactical opportunity to set longs," the Goldman strategists noted.

Briggs said he does not see an uptrend in yields and sees the 1.75% to 2% zone on the 10-year yield as a "buy the dip zone."

 

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Ya seen Amazon? Screw treasuries!!!

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Asian stocks fall on fears U.S.-China trade stallingAsian stocks and Wall Street futures fell on Wednesday on growing worries U.S.-C... ' Impeach' those who 'impeach' ..methinks ! Well, it has stalled. No need to fear certainty now. See what is next, like the economic depression coming to all countries thanks to the debt blow out in each country starting with Japan! That’s weird I thought all that was factored in. Just more bs from a sketchy industry
Source: Reuters - 🏆 2. / 97 Read more »