On Wednesday, the yield on the benchmark 10 - year U.S. Treasury note retreated from five -
year highs above 5.33 percent to 5.22 percent, a day after concerns about rising interest rates drove a stock - market sell - off.
But Wood Mackenzie speculates that investors might not remain so stubborn with U.S. crude prices at three -
year highs above $ 60 and a corporate tax cut windfall on the horizon.
The S&P 500 gained almost triple its historic average last year, and 10 - year Treasury note yields hit a three -
year high above 2.7 %.
Not exact matches
In the
above table, I have selected a few prior
years with interim
high and low readings, as well as the last 4
years, and further broken out 2015 by quarter.
These products pay well
above the 10 -
year Canadian government rate, but they are riskier to own — the
higher coupon corresponds to a
higher chance of default.
Ten
years later in 2017, the marginal tax rate for the lowest tax bracket (up to $ 42,200 of taxable income) has fallen to 20.1 percent while the marginal tax rate on
highest tax bracket (
above $ 220,000 of taxable income) has risen to 53.5 percent.
The benchmark 10 -
year yield hit a
high of 2.626 % on March 13, briefly ticking
above the 2.60 % threshold that the bond - market veteran Bill Gross had said was «much more important than Dow 20,000.»
In January, Miller said a rise in the 10 -
year Treasury yield
above 3 percent «will propel stocks significantly
higher, as money exits bond funds for only the second
year in the past 10.»
In fact, the comments section of the
above mentioned article has many stories of people who did sell in past
years because they thought house prices were too
high, only to subsequently watch from the sidelines as prices continued to march upward.
In private industry, says the Bureau of Labor Statistics, wages and salaries rose at 2.6 % for the 12 months ended September 2017 — 20 basis points
above the rate the prior
year and notably
higher than what we saw in the first half of the decade.
Home prices keep pushing
higher, with the median new home price
above $ 300,000, a 6.1 % gain over last
year.
The S&P 500 has had a remarkable
year — up 19 percent — while the Dow Jones industrial average added more than 150 points intraday Tuesday to trade at an all - time
high above 24,000.
But this weighting significantly reduces the average; if you weight by the number of
years you find a
higher growth rate
above 90 percent.
To qualify for federally regulated mortgages, borrowers must be able to afford interest rates that are two percentage points
above the contracted rate or the Bank of Canada's five -
year benchmark rate, whichever is
higher.
Germany's 10 -
year Bund yield, the benchmark for the bloc, rose to 0.58 percent, but held below six - week
highs set last week
above 0.65 percent.
This is particularly true because gold has already broken
above its six -
year trend line, going all the way back to those 2011
highs.
Bitcoin has lost half its value this
year after surging 2,000 percent in just 12 months to a record
high above $ 19,000 in mid-December.
THE fundamentals of the gold market clearly supported a
higher price, this
year and in the future, according to Newmont chairman and CEO Ronald Cambre.The basis of his argument is that record consumption in 1999 was seven per cent
above the previous...
The
above chart assumes on the low end that one saves about $ 5,000 a
year in after - tax income and around $ 10,000 - $ 15,000 a
year in after - tax income on the
high - end after maxing out their tax - deferred retirement vehicle.
The 10 -
Year's move
above 3 %, which is believed to be a «psychological» level by many, may be unwelcome competition for dividend paying stocks, especially if it continues to head
higher.
On Monday, the European benchmark closed
above $ 64 a barrel, more than a two -
year high.
The Dow Jones Industrial Average closed
above 1,000 - its
highest levels in nearly a decade - and it was on the precipice of saying sayonara to a 16 -
year bear market.
This may not seem very
high, but prior to this past November we hadn't seen the 10 -
year rate
above 2 % since September 2014.
The stock broke
above 7 -
year resistance at $ 8.26 in 2014, then rallied to an all - time
high of $ 18.48 a few months later.
Today, the prime rate is 4.25 percent — the
highest level of the
year and 3 percent
above the fed funds rate.
This time around it is 48 %
above the 2000
high and could not post a bullish outside
year as it did not trade below the 2015 low (At this point).
In 1982 the DJIA closed the
year just 5 %
above the 1966
high (also posting a bullish outside
year).
However, over the
years, we have learned to establish partial position size at or near the lows of a handle, and add to the position on the breakout
above the
high of the handle.
In 1982 it finished the
year just 50 %
above the 1966
high and then proceeded to post another 7 up
years in a row.
Further, they note that 2016 has the potential to be a «bullish outside
year» for the S&P 500 — meaning the
highs and lows for this
year's candle are both outside of 2015's range, with a close
above last
year's
high.
Today the S&P sits just 31 %
above the
high posted 16
years ago in 2000.
The roll rate — the percentage of credit card users who «roll» from early stage delinquencies to 60 - 89 day delinquencies — reached the
highest since 2008 for one credit card program, while delinquencies for another were
above the 10 -
year average, according to Royal Bank of Canada credit analyst Vivek Selot.
Though buyouts have a slightly
higher average annual distribution than venture capital, more buyout capital is invested in each
year such that the absolute buyout distributions have not surpassed called capital in the time frames measured
above.
I've also included a Google Docs list of all the companies in the list with their streak length, but the excel spreadsheets provided
above have a lot more information like the dividend yield, average
highest yield for 3, 5 and 10
years, the past 10
years worth of dividends, and lots of other stock information.
The US oil - rig count plateaued near the
highest level in three
years and showed signs of declining in late March (to 797), though it still stood 50 rigs
above the
year - end 2017 total.2 This contributed to expectations for a further increase in American crude production, which has topped 10 mb / d each week since early February, when WTI prices began to recede from their intra-quarterly
high of US$ 66.14 a barrel.3 The amount of crude in US storage occasionally exceeded weekly estimates given the
higher domestic output and fluctuating net import figures, reigniting fears that US production may thwart OPEC's efforts to clear global oversupply.
Empire manufacturing survey came in at 18.7,
above the 7.5 expected and the
highest reading in two and a half
years.
Now that $ SMH has finally broken out to a new 52 - week
high, the breakout
above the nine -
year downtrend line shown
above is becoming confirmed.
Taking this a step further, the chart
above shows that out of the most recent 23 periods of
higher rates (based on the 10 -
year Treasury yield), stocks have gained ground 19 of those times.
According to Morgan Stanley's Chris Metli, a strengthening dollar — the greenback put in its best monthly rise since President Donald Trump's election in April — and a rising 10 -
year Treasury note yield TMUBMUSD10Y, -0.63 % — the 10 -
year yield touched its
highest level in more than four
years above 3 % late last month — are also factors weighing on stocks.
History suggests that
higher rates may actually be a good thing, and should the 10 -
year Treasury yield break
above the psychologically important 3 % level, the equity bull market may garner further support.
While technically not an LTRO, the ECB's pledge last
year to do «whatever it takes» (not shown) has allowed the EuroStoxx index to recover its prior 6 - month loss, taking the index a few percent
above its early - 2012
high.
US large - cap stocks returned more than 9 percent in the first half of 2017, the most since 2013, and although prices are close to all - time
highs, analysts are of the opinion that valuations are not very expensive for a majority of these stocks, as stronger earnings upped the price - to - earnings ratio, which has generally remained
above average for quite a few
years.
In fact, even a several -
year span can be misleading, as a manager may be able to achieve
above - average results by owning very
high - risk stocks in a generally rising market but be virtually wiped out in the same class of stocks in a bear market.
Indeed, the Nikkei is no
higher than it was 30
years ago, having lost more than -60 % of its value on three separate occasions, two of them in a period when interest rates were pegged at zero, and never rose
above 1 %.
These conditions comprise the following: S&P 500 overvalued with the Shiller P / E (the ratio of the S&P 500 to the 10 -
year average of inflation - adjusted earnings) greater than 18; overbought with the S&P 500 within 3 % of its upper Bollinger band (2 standard deviations
above the 20 - period average) at daily, weekly, and monthly resolutions, more than 7 %
above its 52 - week smoothing, and more than 50 %
above its 4 -
year low; overbullish with the 2 - week average of advisory bullishness (Investors Intelligence) greater than 52 % and bearishness below 28 %; and yields rising with the 10 -
year Treasury bond yield
higher than 6 - months earlier.
At this point, it's human nature to say — as I've often heard from clients over the last 39
years, whenever short rates rise
above long rates — why buy a 20 -
year bond when I get a
higher yield on a 2 -
year piece of paper?
In the United Kingdom, headline inflation is close to 3 percent on an annual basis,
higher than the central bank's projected target of 2 to 2.5 percent; and in the United States, consumer inflation remained
above the central bank's 2 - percent target until May of this
year before slipping modestly.
Returns would be back
above break even in
Year 4 thanks to the reinvestment of the much
higher yield.
After the third longest bull market advance on record, fresh deterioration in key trend - following components within our measures of market internals (see Support Drops Away) recently joined this extended, overvalued, overbought, overbullish peak, even as the S&P 500 hovers at the top of its monthly Bollinger bands (two standard deviations
above the 20 - period average) and cyclical momentum rolls over from a 9 -
year high.
Knowles has grown rapidly over the
years as consumers demand
higher acoustic features in each new generation of smartphones and hearing aids, and we expect this trend to continue, which should drive
above average top - line growth.