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Anonymous ID: 14250a March 27, 2019, 7:50 p.m. No.5934407   🗄️.is 🔗kun   >>4418

Bond yields spiral lower, Asian stocks along for the ride

 

SYDNEY (Reuters) - Asian share markets were painted red on Thursday as recession concerns sent bond yields spiraling lower across the globe, overwhelming central bank efforts to calm frayed nerves.

 

Sterling was also hit by another bout of Brexit blues after a round of votes in the U.K. parliament failed to produce any new plan to manage its divorce from the European Union.

 

A Reuters report that the United States and China had made progress in all areas in trade talks had little obvious impact since sticking points still remained and there was no definite timetable for a deal.

 

MSCI's broadest index of Asia-Pacific shares outside Japan slipped 0.3 percent, with South Korea down 0.7 percent and Shanghai blue chips slipping 0.3 percent.

 

Japan's Nikkei fell 1.7 percent. U.S. stocks could not escape the malaise with E-Mini futures for the S&P 500 off 0.5 percent.

 

Worries that the inversion of the U.S. Treasury curve signalled a future recession only deepened as 10-year yields fell to a fresh 15-month low at 2.34 percent.

 

"We think that the ongoing flattening, or outright inversion, of the curve is a bad sign for equities, as it usually has been in the past," said Oliver Jones, markets economist at Capital Economics.

 

"Arguments that the yield curve is no longer a reliable indicator seem to resurface every time it inverts, only to

 

be subsequently proved wrong."

 

The latest lunge lower was led by German bunds where 10-year yields dived deeper into negative territory after European Central Bank President Mario Draghi said a hike in interest rates could be further delayed.

 

Plans to mitigate the side-effects of negative interest rates could also be considered, suggesting the central bank was preparing for an extended period below zero.

 

That shift came hot on the heels of a dovish surprise on Wednesday from the Reserve Bank of New Zealand, which abandoned its neutral bias to say the next rate move would likely be down.

 

Yields in both New Zealand and neighbour Australia, quickly sank to record lows in response.

 

The RBNZ explicitly cited all the easing moves by other central banks as a reason for its turnaround since they had put unwanted upward pressure on the local dollar.

 

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https://sg.finance.yahoo.com/news/bond-yields-spiral-lower-amid-global-growth-gloom-004057403–finance.html

https://www.kitco.com/charts/livegold.html

https://www.marketwatch.com/investing/bond/tmubmusd10y?countrycode=bx