Earnings continuewith Declining Treasuries as Global Stocks Recover
The global stock rally went up as the benchmark Treasury yield moved to 3%. Both crude oil as well as yen increased as the dollar fell again for fifth day in a row.
The market conditions globally were affected by the other markets. The Stoxx Europe 600 Index grew for a second day followed by Asian equities rallying. The U.S stocks were hinted to open higher by the futures on S&P 500. The yield on the 10-year Treasuries remained over 2.9% growing for a second day.
The bond traders have raised their hopes after the U.S consumer prices increased more than expected in January. The traders are anticipating the Federal Reserve to hike the interest rate four ties by the end of next year.
Gina Martin Adams and Peter Chung who are the equity strategist at Bloomberg Intelligence, said that compared to bonds, stocks remain cheap and higher long term interest rates will not impact them as long as the 10-year Treasury yield maintain its position below 4%.
The finance minister of Japans Taro Aso said that, the way yen is strengthening does not immediately call for an intervention supporting the rally of the Japanese currency.
The earnings season is on full-mode and some of the main moves in the market are:
The Stoxx Europe 600 Index gained 0.9% which is the highest in over a week. Germany’s DAX Index also rose 0.8%, the highest it did in more than a weeks’ time. Meanwhile, the MSCI All-Country World Index increased 0.7% to 518.60 also reaching its topmost level in almost two weeks marking its fifth consecutive gain.
The Bloomberg Dollar Spot Index hit its lowest in more than three years with its fifth decline in a row dipping 0.4% to 1,114.22. On the other hand, euro rose 0.4% to $1.2496 achieving its strongest position in two weeks and is the currency’s fifth straight advance.
South Africa’s rand soared 0.8% to 11.6281 per dollar which is the strongest the currency has been in three years. The Japanese yen grew 0.7% to 106.31 per dollar, the strongest in roughly 15 months.