Diamond News Archives

The increase in U.S. Treasury yields continued on Tuesday, with the benchmark rate turning higher to once again edge toward 3 percent. Stocks in Europe nudged upward following gains for most Asian markets as the earnings season gathered pace.

The yield on 10-year U.S. notes climbed as the securities reversed an earlier advance, while the dollar maintained Monday gains that sent it to the highest level since January. The Stoxx Europe 600 Index eked out a second day rising as traders assessed a mixed bag of corporate results, while U.S. equity futures posted a more solid jump. The yen retreated, helping spur Japan’s Topix index to the highest in almost two months, and Chinese shares rallied on signs the government may ease off tightening measures if warranted.

Investors are weighing the implications of climbing bond yields that have been spurred in part by higher commodity prices and concern surrounding their inflationary impact on the wider economy. But volatility in interest-rate markets remains low and equity price swings are well off the highs seen earlier this year, indicating investors believe rising borrowing costs may not be enough to cause outsized pain to equities -- for now.

“For us it’s more the reasons why we’re seeing the move: better growth outlook, a little bit more inflation and faster rate hikes being priced in by the market,” Kerry Craig, Melbourne-based global market strategist at JPMorgan Asset Management, told Bloomberg TV. “It should be reaffirming the fact that we see a global economy that’s looking relatively healthy.”

Source: Bloomberg

Elsewhere, aluminum extended its...

The rise in U.S. Treasury yields appeared to stall on Tuesday, with the benchmark rate trading sideways after a selloff this week took it to within a whisker of 3 percent. Stocks in Europe struggled for traction following gains for most Asian markets as the earnings season gathered pace.

The yield on 10-year U.S. notes was little changed after the securities pared an earlier advance, while the dollar nudged lower after jumping on Monday to the highest level since January. The Stoxx Europe 600 Index pared an increase as traders assessed a mixed bag of corporate results, while U.S. equity futures posted a more solid jump. The yen retreated, helping spur Japan’s Topix index to the highest in almost two months, and Chinese shares rallied on signs the government may ease off tightening measures if warranted.

Investors have been weighing the implications of climbing bond yields that were in part spurred by higher commodity prices and concern surrounding their inflationary impact on the wider economy. But volatility in interest-rate markets remains low and equity price swings are well off the highs seen earlier this year, indicating investors believe rising borrowing costs may not be enough to cause outsized pain to equities -- for now.

“For us it’s more the reasons why we’re seeing the move: better growth outlook, a little bit more inflation and faster rate hikes being priced in by the market,” Kerry Craig, Melbourne-based global market strategist at JPMorgan Asset Management, told Bloomberg TV. “It should be reaffirming the fact that we see a global economy that’s looking relatively healthy.”

Gold softened overnight in a range of $1325.20 - $1335.80. It failed to hold support at the triple bottom low at $1334-5 (4/12, 4/13, and 4/20 lows), the 50-day ($1333) and 40-day moving averages ($1332) and the up trendline from the 12/12 $1236 low at $1330 to reach $1325.20 – a 2-week low. Mostly long liquidation was seen.

Gold was pressured by a stronger dollar, as the DX rallied from 90.32 – 90.73 (2-month high). The greenback found some buying over the down trendline at 90.48, and was bolstered by weakness in the yen (107.65 – 108.28, weaker Japanese PMI), the euro ($1.2285 - $1.2225, miss on Eurozone Manufacturing PMI) and the pound ($1.4030 - $1.3945).

A rise in the US 10-year yield to 2.998% (4-year high) was dollar supportive, and rise in global bond yields also weighed on gold with the German Bund (0.603% - 0.639%), UK Gilt (1.49% - 1.53%) reaching 1-month highs.

Global equity markets were a tad softer and a mild tailwind for gold with the NIKKEI of 0.3%, the SCI down 0.1%, European markets were down from 0.1% to 0.2%, and S&P futures were +0.1%.

News that Kim Jong Un said North Korea would suspend nuclear and missile tests ahead of summits with South Korea and the US was also a bearish development for gold.

US equity futures - which were in the red with other global equity markets for most of the night - turned positive (S&P futures to 2678) just ahead of the NY open, helped by an upgrade of Merck by Goldman and an upgrade of Caterpillar by Citi.

The DX ticked up to 90.74, and gold slipped to $1323.90 – despite a miss on the Chicago Fed National Activity Index (0.10 vs. exp....

HTTP/1.1 200 OK Server: nginx/1.13.5 Date: Mon, 23 Apr 2018 22:15:05 GMT Content-Type: text/html; charset=UTF-8 Content-Length: 209227 Connection: keep-alive Vary: Accept-Encoding, Cookie Cache-Control: max-age=3600, public X-UA-Compatible: IE=edge Content-language: en X-Content-Type-Options: nosniff X-Frame-Options: SAMEORIGIN Expires: Sun, 19 Nov 1978 05:00:00 GMT Last-Modified: Mon, 23 Apr 2018 22:15:03 GMT ETag: W/"1524521703" X-Backend-Server: drupal-6dc8756b7f-2szxs Age: 0 Varnish-Cache: HIT X-Cache-Hits: 1 X-Served-By: varnish-1 Accept-Ranges: bytes ...

References

1. ^{^} Skip to main content (www.zerohedge.com)