RSS feedYields
’Strong demand for Spanish debt [updated]
No, really there is.
Via Reuters on Thursday.
RTRS-SPAIN 2015 BOND AVERAGE YIELD 5.187 PCT (LAST AUCTION 3.639 PCT)
RTRS-SPAIN 2016 BOND AVERAGE YIELD 5.276 PCT
RTRS-SPAIN 2017 BOND AVERAGE YIELD
Dios mío! – redux
Oh dear.
Oh dear, oh dear.
Oh dear, oh dear, oh dear.
A meagre yield appetite
Were we wrong to say on Tuesday that the performance of US investment grade bonds this year was only “impressive” because they were just following Treasuries down the yield rabbit hole?
SocGen’s big Q4 preview would seem to suggest as much — or at least it would suggest that although we might have been right until very recently,
Trichet – the verdict
We already know what the markets made of Thursday’s moves by the ECB to try and halt the contagion in the eurozone from spreading.
Here’s the verdict from the sell side. Think moving with the handbrake on.
A warning signal from the Bund/Treasury spread
This sounds a bit disconcerting from Charlie Diebel at Lloyds TSB on Wednesday:
One of our key comparative metrics is flashing Red this morning and that is in the 10yr Bund/T-Note spread. Our models have
Christmas shopping for US Treasuries
Have US bondholders gone on holiday already?
10-year Treasuries reached a high of 3.39 per cent on Monday before falling sharply.
This course wasn’t altered by a cautious warning from Moody’s that stimulus without future offsetting increases the likelihood of a US rating revision in the medium term.
Infected – German bunds
Is nothing immune from the sovereign debt woes of the European periphery?
Apparently not.
Now, throughout the sovereign debt crisis in Europe, the bund has been the beneficiary of safe-haven flows coming out of the periphery — Portugal,
The Merkel crash
So what’s really behind the spike in Spanish government bond yields on Monday?
How about this: because of Angela Merkel’s European Stability Mechanism the market is finally being being forced to price in default risk for eurozone countries.
The insecure unsecured switch
This is a chart from the latest edition of the European Mortgage Federation’s monthly newsletter showing the yield differential between unsecured senior bank debt and covered bonds:
The following chart highlights what’s going on a little better.
Clutching at dividends
The world has become full of risk-averse investors, and stocks will suffer.
Wait — let’s edit that.
The world has become full of yield preservers, and they will suffer stocks. Or — as is current fashion — stock dividends.
Stop the market – the Fed wants to get off
Oops.
The Federal Reserve didn’t mean for its recent QEII announcement — that it would be reinvesting proceeds from its maturing securities portfolio — to so greatly affect investors.
So said Minnaepolis Fed president Narayana Kocherlakota in a (telling) Tuesday speech:
Talking US Treasuries
The results of the first of this week’s three auctions of US government debt are in.
Via RBS’ William O’Donnell:
3 Year Treasury Auction Results Auction
Date: 05/11/2010
Size: $38 Billion ($2B less than last month)
Maturity:
BA and BT’s promiscuous pensions
As the market waits with bated breath for an update on British Airways’ triennial review of its pension scheme, we note some parallels with another leviathan of UK corporate pension deficits — BT.
The telephone company released its second-quarter earnings last month,
The quest for yield, redux
European insurers are having trouble adjusting to life in the land of Zirp.
While 2008 insurance results were all about impairments, the latest round of Euro insurer figures show a growing preoccupation with yield.
Corporate credit bears
While rising government bond yields have been making headlines of late, especially in relation to the possibility that they could derail an economic recovery, corporate bonds — which were a bull story in early 2009 — have languished in the background.
The new art of inflation mongering
One of the biggest debates concerning the current crisis has focused on whether the world is heading towards a deflationary or inflationary environment. But it appears there’s a new ‘big’ debate emerging:
UK lenders increasing mortgage rates
The Bank of England may have kept rates on hold at 0.5 per cent last week, and the 3-month Libor rate may still be edging lower, but that is unlikely to stop many UK lenders from raising mortgage rates as soon as next week.
Napier: Higher yields do not mean normalisation
If you’re unconvinced by the current market rallies but don’t quite know why, the following John Authers interview with Russell Napier, bear market historian and author of ‘Anatomy of the Bear’ is definitely worth some of your time.
The ‘QE’ stockmarket effect
On paper, the Fed and Bank of England initiated quantitative easing policies to try and keep long-term yields down and to boost the level of aggregate banking sector reserves so as to encourage bank lending.
The return of yield?
Some not so dovish Fed comments and yields are creep, creep, creeping higher….
Standard Chartered writes (our emphasis):
The UST curve bearish steepened significantly with the 10Y yield approaching five-month highs after the Fed was less dovish than expected.