Bond yields rise as trading in stocks dips in Europe, picks up in US
ALBAWABA – Trading in stocks dipped in Europe against a rise in the United States (US) on Monday, in both Treasury Bills and stock indexes, Bloomberg reported.
European stocks retreated as an index of German industrial output fell to a six-month low, underscoring weakness in the economy.
Trading in stocks in Europe were also relatively light, with trading of Euro Stoxx 50 stocks at about 40 percent less than the 30-day average.
A selloff in government bonds accelerated as concerns over further rate hikes unsettled traders, according to Bloomberg.
The yield on 30-year German bonds rose nine basis points to 2.72 percent, the highest since early 2014. Similar-maturity US Treasury yields jumped seven basis points. Meanwhile, US equity futures rose modestly, signaling a rebound from Friday’s retreat.
Federal Reserve Governor Michelle Bowman said over the weekend that the US central bank may need to raise US interest rates further in order to fully restore price stability, as reported by Bloomberg.
Investors also considered mixed signals from Friday’s US jobs report, which showed wages above forecast even as payrolls growth moderated, according to the New York-based news agency.
“We don’t think central banks will get the rise in unemployment rate and sustained moderation in wage growth in the coming year that they hope to see,” ADA Economics Ltd. Chief Economist Raffaella Tenconi said in an interview with Bloomberg TV.
The key data point for the week will be US consumer price index reading on Thursday, which is expected to show moderate price growth. The index is projected to rise 0.2 percent in July for a second month after excluding food and energy costs, marking the smallest back-to-back gains in 2 1/2 years.
Markets summary by Bloomberg
Stocks
S&P 500 futures rose 0.3 percent as of 7:10 a.m. New York time
Nasdaq 100 futures rose 0.4 percent
Futures on the Dow Jones Industrial Average rose 0.2 percent
The Stoxx Europe 600 fell 0.4 percent
The MSCI World index fell 0.2 percent
Currencies
The Bloomberg Dollar Spot Index rose 0.2 percent
The euro fell 0.3 percent to $1.0975
The British pound fell 0.1 percent to $1.2730
The Japanese yen fell 0.4 percent to 142.38 per dollar
Cryptocurrencies
Bitcoin was little changed at $29,073.92
Ether rose 0.2 percent to $1,833.55
Bonds
The yield on 10-year Treasuries advanced seven basis points to 4.10 percent
Germany’s 10-year yield advanced five basis points to 2.61 percent
Britain’s 10-year yield advanced seven basis points to 4.45 percent
Commodities
West Texas Intermediate crude fell 1 percent to $82 a barrel
Gold futures fell 0.3 percent to $1,969.80 an ounce
