Not exact matches
LONDON, April 23 - Hamstrung
by a renewed slump in volatility and lack of clear
market direction, FX and bond speculators are making historically big bets on a lower dollar and higher
yields.
In a year marked
by a significant milestone for rising interest rates (the 10 - year Treasury note
yield topping 3 percent), an unusual winner has begun to emerge in the stock
market: utility stocks.
The
yield on the U.S. 10 - year Treasury jumped to its highest level since 2014 on Friday morning, underlining a wider move in bond
markets caused
by central banks moving away from financial crisis policies.
Powell's comment was pointed to
by bond
market strategists as a reason for a sudden pop in bond
yields.
MARKETS: The dollar held near a four - month high against a basket of major currencies, buoyed
by the outlook for a strong U.S. economy and rising
yields amid signs of slowdown elsewhere, especially in Europe.
By mid-December it was clear that a late - quarter rout in the high -
yield bond
market was likely to hit revenues.
By contrast, in August, when the
market was still anticipating that the Fed might raise its key interest rate in September, the two high -
yield funds lost a net $ 344 million.
Then «tapering» talk
by the Federal Reserve caused U.S. bond
yields to shoot up and draw back the capital that had earlier flowed into the emerging
markets, putting more downward pressure on financial
markets and currencies.
NEW YORK, Nov 28 - The Federal Reserve faces the challenge of standing
by as financial
markets «correct» as the central bank trims its asset holdings, U.S. hedge fund manager David Tepper said on Tuesday, adding he was surprised the bond -
yield curve was so flat.
While that might suggest the «smart money» is signaling a swift correction, don't necessarily buy it: Lipper research found that «following the most recent periods of four or more consecutive weeks of net outflows from the Lipper High
Yield ETF segment, the
market — as measured
by the BofA Merrill Lynch U.S. High
Yield Master II Index — performed relatively well in the calendar month that immediately followed.
«According to the higher interest rates and bond
yields projected
by consensus, the
market has started to wonder when the BOE would start raising rates again.
Bond
yields snapped higher, adding to their already steep gains, and federal funds derivatives showed
market expectations are moving closer to pricing in a full three interest rate hikes
by December.
History shows when the benchmark rate for everything in the economy from corporate bond
yields to mortgage rates moves
by this much, this fast, the stock
market struggles in the following months.
But the bank has taken more extreme measures, such as ramping up purchases to more than 40 percent of the
market overall and saying it would control the
yield curve
by keeping the 10 - year government bond
yield around 0 percent.
Yields in the $ 14 trillion
market for U.S. government debt touched record lows in 2016, driven
by years of aggressive central bank intervention in the wake of the 2008 - 2009 financial crisis to keep interest rates low to stimulate the economy.
Bonds due in 2018 and won
by BofA were «aggressively» priced with a 1.64 percent
yield that narrowed Illinois» spread over Municipal
Market Data's benchmark triple - A
yield curve to 70 basis points from 100 basis points ahead of the sale, Greg Saulnier, a MMD analyst, said.
More than a dozen financial institutions listed
by Bankrate have savings and money
market accounts with annual percentage
yields of 1 percent or more.
Attract a wider array of capital to clean energy investments
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yield - cos and other vehicles.
Putting the recent
market indigestion into context, the positively sloped
yield curve offers some comfort
by suggesting the selloff may be short - lived and could be an opportunity to take advantage of cheaper valuations.
That was one of the all - time classic bear
markets, characterized
by high inflation, high unemployment, high Treasury
yields and rising inflation — as well as strong rallies followed
by sharp selloffs.
Its underlying index selects and weights its bonds
by market value, and this method
yields a portfolio that aligns well with our benchmark in terms of credit tranches and maturity buckets, with the only notable difference being a slightly lower YTM.
For instance, the U.S. high
yield market, as measured by the Barclays U.S. Corporate High Yield 2 % Issuer Capped index, experienced its worst start to a year ever, going back to 1994, Bloomberg data
yield market, as measured
by the Barclays U.S. Corporate High
Yield 2 % Issuer Capped index, experienced its worst start to a year ever, going back to 1994, Bloomberg data
Yield 2 % Issuer Capped index, experienced its worst start to a year ever, going back to 1994, Bloomberg data show.
That
yield support leads to another phenomenon that has been studied
by respected Wharton professor Dr. Jeremy Siegel, which he calls the «Return Accelerator» or bear
market protector.
The selling has extended into other asset classes, notably commodities and high
yield, and has been accompanied
by an abrupt spike in
market volatility.
The $ 1.2 trillion
market for U.S. junk bonds
yields about 6.6 percent, double what's offered
by higher - rated company debt, according to Bank of America Merrill Lynch index data.
Money
market accounts are high -
yield accounts offered
by banks and credit unions that are like a hybrid of a savings account and a checking account.
By doing this, central banks hope to condition
market expectations, lowering interest rates further out the
yield curve (much like additional cuts to short - term interest rates would have done, had they been possible).
News can affect
yields by offering
market participants insight into economic fundamentals and shaping their expectations of central banks» future monetary policy decisions.
Interestingly, some German data releases closely followed
by market participants — such as German GDP, industrial production, and employment statistics — did not significantly influence German
yields, report Goldberg and Leonard.
There are a multitude of reasons as to why this occurs but it's a powerful enough force that many investors have done quite well for themselves over an investing lifetime
by focusing on dividend stocks, specifically one of two strategies - dividend growth, which focuses on acquiring a diversified portfolio of companies that have raised their dividends at rates considerably above average and high dividend
yield, which focuses on stocks that offer significantly above - average dividend
yields as measured
by the dividend rate compared to the stock
market price.
Emerging -
market companies have piled on debt in recent years, allured
by low interest rates from
yield - starved investors.
As of last week, the
Market Climate in stocks remained characterized
by an overvalued, overbought, overbullish, rising -
yields syndrome that has historically produced periods of marginal new highs, slight declines, and yet further marginal highs, followed somewhat unpredictably
by nearly vertical drops.
Among emerging
market stocks, results with rule - based screening were even higher — when these screens were applied, the EM High Dividend
Yield Index outperformed its benchmark
by 5.1 points in our simulation.
XDV, with a current
yield of about 3.9 %, holds the 30 biggest companies
by market cap that also pay a dividend.
In bonds, Friday's tepid unemployment report was accompanied
by a substantial decline in both real and nominal
yields - enough to move the
Market Climate in bonds to a condition of both unfavorable valuations and unfavorable market a
Market Climate in bonds to a condition of both unfavorable valuations and unfavorable
market a
market action.
I've long noted that the analysis of
market action can help to overcome some of this frustration, as stocks have often provided good returns despite rich valuations so long as
market internals were strong, and the environment was not yet characterized
by a syndrome of overvalued, overbought, overbullish, and rising
yield conditions.
Sometimes Convenience
Yields are earned,
by holders of government bonds that are in short supply in the
market.
If you're close to retirement, it's likely that you don't want to turn to high - risk (and high -
yield) investments in the event the
markets don't perform well enough
by your retirement date.
Note that in the 1987 case, the unusually strong 10 - year return reflects a move to the extreme bubble valuations in the late 1990's, which have in turn been followed
by 13 years of
market returns below Treasury bill
yields.
Speaking of the Treasury, they've got to pretty massively increase the supply of bonds to the
market to fund the deficits induced
by the tax cut and spending bill, which puts downward pressure on bond prices and upward pressure on
yields.
The 10 - year
yield is dictated
by the Treasury bond
market.
As of last week, the
Market Climate for stocks remained characterized
by strenuous overvaluation, overbought conditions, overbullish sentiment, and hostile
yield pressures.
Because the 10 - year
yield is dictated
by the
market, and the
market still won't believe in aggressively higher long - term inflation given the 30 + year downward trend.
The optics sector may be overlooked
by many investors, but a handful of stock picks in the space could
yield attractive returns, according to Loop Capital
Markets.
Oil prices have fallen more than 15 percent since March 4 to a six - year low of $ 42.3, wiping out $ 7 billion of
market value of high -
yield debt issued
by energy companies.
IMO they are being short - changed
by the
market today —
yielding nearly 5 %.
We believe the key to investing in high
yield bonds is investing in solid companies run
by strong management teams that can navigate variable
market conditions.
In the meantime, investors do not seem to be concerned
by the interest rate warnings and continue to fuel the ETF
market looking for the greatest amount of
yield.
The
Market Climate remains characterized
by extreme valuations, unfavorable trend uniformity, and hostile
yield trends.
Funds with
yields that are relatively high when compared to other funds in the same investment category are likely to be engaging in
market timing
by building a defensive cash position that in turn generates higher income.