Bond strategists upgraded their U.S. Treasury yield forecasts for coming months to their highest since at least November amid sticky inflation and greater conviction in financial markets of fewer Federal Reserve rate cuts this year, a Reuters poll found. After hitting a cycle peak of 5.02% in October 2023, the benchmark U.S. 10-year Treasury yield US10YT=RR plummeted over 110 basis points by year-end as traders rapidly priced in nearly 150 basis points of Fed interest rate cuts in 2024. Persistent inflation and strong U.S. economic data have forced markets to ...

Hedge funds sold single stocks at the fastest pace in five months in the week to May 10, Goldman Sachs said in a client letter, ahead of U.S. inflation figures that could determine global central banks’ next moves. Sellers also outweighed buyers of global equities for the first time in four weeks, the Goldman Sachs prime brokerage note which tracks hedge fund activity showed. This included traders that unwound long positions, which speculate that the price of an asset will rise, and those that added short positions, which bet on ...

Investors are racing back into European bank stocks after a surprisingly upbeat earnings season, pushing their shares to multi-year highs, but the bounce has also lured short sellers betting that the optimism is unlikely to last. The STOXX European banks index climbed past 200 on Friday, its highest level since August 2015, as confidence in the sector’s earning power grows while the U.S. Federal Reserve and Bank of England hold back on widely-anticipated interest rate cuts. But the number of investors making short bets against some major banks is also ...

Expectations over interest rate cuts rather than earnings optimism has made investors the “most bullish” since November 2021, Bank of America’s monthly fund manager survey for May showed on Tuesday. The survey of global fund managers with $562 billion in asset under management found 82% expect the first by the rate cut by the Federal Reserve in the second half, while 78% say a recession is unlikely over the next 12 months. Cash levels fell to a 3-year low of 4% from 4.2% the previous months and stock allocation reached ...

Asian shares hovered around 15-month highs on Tuesday and the dollar was firm ahead of highly anticipated U.S. inflation data, while Japanese bonds were squeezed as the central bank pulled back a little on its bond buying programme. MSCI’s broadest index of Asia-Pacific shares outside Japan climbed slightly and hit its highest since early 2023 in morning trade, as a strong rally in Hong Kong shares extended into a fourth consecutive week. Japan’s Nikkei was flat. Benchmark 10-year Japanese government bond yields rose one basis point to 0.95%, the highest ...

Switzerland and Sweden have already cut rates this year. The Eurozone and the UK look set to follow shortly. And the Fed eagerly awaits the starting pistol on its easing cycle – if only the data would allow. ING’s call is that US price and activity data will allow the Fed to start cutting in September. We see some modest downside to the dollar ahead of November. Executive summary It looks like an increasing number of central banks are wanting to ease monetary policy. With countries like Switzerland and Sweden ...

China’s finance ministry plans to start raising 1 trillion yuan ($138 billion) in long-awaited, long-term special treasury bonds this week to raise funds it will use to stimulate key sectors of its flagging economy. The finance ministry confirmed what four sources had told Reuters earlier on Monday that the 1 trillion yuan ($138.23 billion) of special government bonds would have tenors of 20 to 50 years and issuance will begin on May 17. The sources who have direct knowledge of the plans said 300 billion yuan worth of 20-year bonds, ...

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Global central banks are starting to break away from the pack as rate cuts roll out across Europe while borrowing costs in the U.S. may stay higher for longer, which is lifting the dollar. A key test of U.S. inflation is at the heart of the data calendar and could be the deciding factor in the near-term direction for markets. Here is your look at what’s happening in markets this coming week from Rae Wee in Singapore, Ira Iosebashvili in New York and Naomi Rovnick and Amanda Cooper in London. ...

A rally in global equity markets lifted stocks in Europe to record highs on Friday amid strong corporate earnings and hopes central bank interest rate cuts are near, while the dollar edged higher despite signs of slowing U.S. economic growth. European shares posted their biggest weekly gain since late January, with the pan-regional STOXX 600 index rising for a sixth straight session, while the FTSE 100 in London hit yet another record high. The Dow industrials index registered its eighth daily advance as the three major Wall Street indexes posted ...

A strong earnings season and blockbuster reports from tech industry titans fueled a U.S. stock market rebound from the first real swoon of 2024. Next week’s inflation data could determine whether the good vibes continue. The benchmark S&P 500 index .SPX is up over 9% for the year, up near its late-March record high, following a 5% pullback that occurredlast month. The bounce has overlapped with a stronger-than-expected first-quarter reporting season for U.S. companies. With well over 80% of the S&P 500 having reported results, companies are on track to ...

Demand for global equity funds rose sharply in the seven days to May 8, driven by renewed bets on Federal Reserve interest rate cuts after a softer than anticipated U.S. employment report. Investors bought a net $12.72 billion worth of global equity funds during the week, the largest weekly net purchase since March 20, data from LSEG showed. Last week, Labor Department data showed U.S. job growth slowed more than expected in April, easing worries that the persistent inflation in the first quarter would push the Federal Reserve to hold ...

India’s inflation to inch higher? April inflation may creep higher again after the slight decline in March on lower gasoline prices, and could touch 5.0% year-on-year again. This is still below the upper limit of the Reserve Bank of India’s inflation tagret (6%) and reflects a mix of seasonal food price increases partially offset by the lower retail gasoline prices in March, which may partially spill over onto the April data. There are no rate policy-relevant ramifications from this. Australia’s labour report out next week The quarterly wage price index ...

Bond funds saw their largest weekly inflow since July 2021 in the week to Wednesday, Bank of America said on Friday, with investors turning to fixed income markets, as global rate cuts come into view. Bonds funds took in net flows of $17.8 billion, the 20th straight week of inflows. That was driven by a $7.3 billion inflow into investment grade, the 28th consecutive week of inflows, putting this sector on course for record $438 billion in inflows so far this year, Bank of America said, citing EPFR data. “Corporate ...

A string of stock listings this year has infused new life into Europe’s anaemic market for initial public offerings, but for some smaller companies it may take longer to open up, bankers told Reuters. While the listings of CVC, Galderma and Puig have made money for investors and helped drive a fourfold increase in IPO volumes so far this year, some have struggled. German on-road payments provider DKV Mobility scrapped plans for a listing, Reuters reported last week. Last month, Portuguese insurer Fidelidade, backed by China’s Fosun International, called off ...