After yesterday's furious rebound in the S&P, which almost appeared staged to confirm the Fed hasn't lost control after its shocking doubling down on dovishness which resulted in a bizarre drop in stocks in the last 30 minutes of trading on Wednesday, the rally once again fizzled overnight, dragged lower by European stocks with U.S. equity futures following, while the euro tumbled and 10-year German bunds slumped into negative for the first time since 2016 after miserable data from the German manufacturing sector renewed worries about global growth on Friday.
The decline in German bund yields comes after the U.S. yield curve flattened further overnight, indicating increased market expectations of a recession.
Bond yields around the world are tumbling to multi-year lows as the global shift by central banks to a more accommodative stance has put the kibosh on the oft-predicted but still-unrealized end of the long bull run in government debt.
For reference, the last time ten-year bund yields closed below zero was in October 2016, with yields having been negative for most of the period between June and October that year - the only time in history.
Gilts also rallied yesterday, with ten-year yields falling -9.3bps to their lowest levels since September 2017, while French ten-year yields fell -5.6bps to their lowest since October 2016.
The fall in yields meant that financials dragged on Euro equities, with the EURO STOXX Banks index down -1.69% yesterday.
Sentiment flipped on the data and positive earnings news, and by the end of the US session lower yields and a dovish Fed were seen as a good thing again.
https://www.zerohedge.com/news/2019-03-22/global-markets-slide-yields-collapse-european-recession-deepens
The decline in German bund yields comes after the U.S. yield curve flattened further overnight, indicating increased market expectations of a recession.
Bond yields around the world are tumbling to multi-year lows as the global shift by central banks to a more accommodative stance has put the kibosh on the oft-predicted but still-unrealized end of the long bull run in government debt.
For reference, the last time ten-year bund yields closed below zero was in October 2016, with yields having been negative for most of the period between June and October that year - the only time in history.
Gilts also rallied yesterday, with ten-year yields falling -9.3bps to their lowest levels since September 2017, while French ten-year yields fell -5.6bps to their lowest since October 2016.
The fall in yields meant that financials dragged on Euro equities, with the EURO STOXX Banks index down -1.69% yesterday.
Sentiment flipped on the data and positive earnings news, and by the end of the US session lower yields and a dovish Fed were seen as a good thing again.
https://www.zerohedge.com/news/2019-03-22/global-markets-slide-yields-collapse-european-recession-deepens
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