A key segment of the US Treasury yield curve briefly turned positive as weaker-than-anticipated labor-market data bolstered bets on steep interest-rate cuts by the Federal Reserve.
It’s been the ultimate no-brainer for more than a year: Park your money in super-safe Treasury bills, earn yields of more than 5%, rinse and repeat. Or as billionaire bond investor Jeffrey Gundlach put it last October, “T-bill and chill.”
There’s no shortage of market-moving events on the docket to keep Wall Street busy right now.
Treasuries rallied after Federal Reserve Chair Jerome Powell’s speech at Jackson Hole cemented expectations that the central bank will cut interest rates next month.
It only takes a quick glance at the US bond curve to realize something is off. One Treasury security — the 20-year — is detached from the rest of the market. It hovers at yields that are far higher than those on the bonds surrounding it — the 10-year and the 30-year.
A major rally in the $27 trillion Treasury market is laying bare anxiety that the US economy is sliding into recession and the Federal Reserve will need to start aggressively cutting interest rates.
Wall Street banks are calling for aggressive interest-rate cuts by the Federal Reserve based on the latest evidence that the labor market is cooling.
History is on the side of stock and bond bulls as Federal Reserve officials kick off a two-day policy meeting.
Treasury yields tumbled after benign inflation data renewed confidence that the Federal Reserve will cut interest rates at least twice this year.
The bond trade that some of Wall Street’s biggest banks say will dominate the rest of 2024 is gaining steam before a crucial inflation reading that will help seal the wager’s fate.
US Treasuries are headed for their biggest monthly rally of the year after the Federal Reserve’s favored inflation gauge decelerated, bolstering expectations for interest-rate cuts starting this year.
Just as optimism is growing among investors that a rally in US Treasuries is about to take off, one key indicator in the bond market is flashing a worrying sign for anyone thinking about piling in.
A technical trading strategy with a perfect trading record this year is signaling that it’s time to sell long-maturity Treasuries after a rally last week.
US government bonds rallied Friday, adding to their monthly gain, after benign inflation data kept alive predictions that the Federal Reserve will cut interest rates at least once this year.
Billionaire investor David Tepper loaded up on beaten-down Chinese stocks last quarter while reducing stakes in high-flying US tech firms, leading hedge fund managers who are slowly warming up to China amid a record gap in valuations between the two markets.
Nothing has been setting the US bond market’s direction this year more than the monthly inflation figures. This week will be no exception.
Anshul Pradhan and Stephen Stanley both saw the current US bond market coming. They just don’t agree on where it’s going.
As the US economy hums along month after month, minting hundreds of thousands of new jobs and confounding experts who had warned of an imminent downturn, some on Wall Street are starting to entertain a fringe economic theory.
Most US Treasury yields climbed to new year-to-date highs, with the 2-year note’s approaching 5%, after hot retail sales data further eroded investor confidence that the Federal Reserve will start cutting interest rate cuts this year.
Federal Reserve Chair Jerome Powell’s increasing focus on protecting the job market is encouraging a swath of bond traders putting bets on inflation rates to remain elevated.
Bond traders have plenty on their plates the next couple days, even after they absorb a crucial US inflation reading that stands to shape expectations for Federal Reserve policy for months to come.
What was supposed to be the darling trade of 2024 has unraveled, thanks to the Federal Reserve upending predictions over how fast it would lower interest rates.
Investors are beginning to war-game how the Federal Reserve can manage a US economy that just won’t land, with some even debating whether interest-rate hikes will be needed only weeks after a steady run of reductions appeared all but certain.
Bond traders are finally heeding one of the market’s oldest lessons: Don’t fight the Fed.
Treasury yields tumbled Thursday as a second day of declines for US financial stocks led traders to price in a more rapid pace of Federal Reserve interest-rate cuts.
Jerome Powell delivered a clear message to traders eager for the central bank to start slashing interest rates: Not so fast.
Bond traders looking for something to jolt the $27 trillion Treasury market out of its recent rut will probably still be left waiting for answers, even after a busy week packed with a Federal Reserve meeting, the government’s quarterly debt-sale plans and a slew of economic data.
Bond traders abandoned wagers that the Federal Reserve will cut interest rates in March, pushing swap rates to levels consistent with only about 50% odds of a quarter-point reduction in the federal funds target during the first quarter.
For most of the summer, the chatter in the bond market about swelling US deficits — and the depressing effect it was having on the price of Treasuries — was incessant.
The most accurate US bond forecasters of 2023 say the strong year-end rally won’t stretch into 2024.
The world’s biggest bond market has clawed its way back after spending chunks of 2023 underwater. Now many US debt watchers see the pathway clearing for a real revival.
A prospect that might have seemed unthinkable just a couple short weeks ago is coming into view for bond traders: The potential for US Treasuries to post an annual gain for the first time since 2020.
Losses on longer-dated Treasuries are beginning to rival some of the most notorious market meltdowns in US history.
To judge by recent history, a US government shutdown won’t be a huge event for the bond market. If anything, it could even provide a little short-term relief, since Treasuries usually rally when investors need somewhere to hide.
Bond investors face the crucial decision of just how much risk to take in Treasuries with 10-year yields at the highest in more than a decade and the Federal Reserve signaling it’s almost done raising rates.
Fifty cents on the dollar is a very low price in the world of bonds. In most cases, it signals that investors believe the seller of the debt is in such financial distress that it could default.
The US bond market hasn’t flashed recession warnings so consistently for so long in at least six decades.
The world’s most powerful central bankers have vowed in unison to keep interest rates higher for longer if necessary to tame inflation.
As brutal as it’s been for US bond investors, the math is finally turning in their favor.
Across Wall Street, there’s growing relief that the Federal Reserve — at long last — may be done raising interest rates. But that doesn’t mean turbulence in the bond market will soon become a thing of the past.
Historically, Treasuries tend to rally when stocks are tumbling, meaning they are negatively correlated. The idea is a cornerstone of the popular 60/40 strategy that uses an allocation to bonds as well as stocks to reduce the volatility of the overall portfolio.
In what was a brutal 2022 for investors, there was at least one sure-fire, money-making proposition for much of the year.
Listen to Wall Street’s top economists and you’ll hear the same message again and again: The risk of a recession is fading fast. And yet, in the bond market, the traditional warning that a downturn is near — an inversion of the yield curve — keeps getting louder.
While the deeply inverted yield curve has stoked anxiety among investors about the prospect of a recession, Goldman Sachs Group Inc. has a different message: stop worrying about it.
Investors loading up on long-term bonds have a history at their back.
The bond market’s re-energized bulls may want to dial down their excitement because their fortunes hinge on whether an abstract, almost elusive number, is as low as they assume.
Some of the biggest bond managers are sticking to their bullish view on the market for US government debt, even as that trade looks riskier by the day.
William Eigen isn’t about to apologize for his bond fund’s performance this year. Yes, his $8.7 billion JPMorgan Strategic Income Opportunities Fund is trailing about 60% of its peers after trouncing nearly every one of them last year.
The once-hot Wall Street trades of 2023 are all falling apart, in a fresh blow to market pros blindsided again and again ever since the pandemic broke out.
Bill Gross, the former chief investment officer of Pacific Investment Management Co., recommended buying short-term Treasury bills, expecting the debt-ceiling issue eventually gets resolved.
