Weekly Fixed Income Commentary: Treasury yields fall due to rising coronavirus cases and stalled stimulus
U.S. Treasury yields declined across the yield curve last week, led by longer maturities. Markets are concerned about rising COVID-19 case counts in the U.S. and Europe, stalemated U.S. fiscal stimulus negotiations and the pausing of several coronavirus drug and vaccine trials.
Although the news trended in a negative direction last week, stocks held their ground and eked out modest gains, with the S&P 500 Index climbing 0.2%. Coronavirus cases have been rising in parts of the U.S. and throughout Europe, although mortality trends have been improving.
U.S. Treasury yields rose across the yield curve last week, led by longer maturities. Investors saw renewed potential for a fiscal stimulus package, as well as the possibility of a Democratic sweep of the White House and Senate. Risk assets rallied as a result.
Equities rallied last week, with the S&P 500 Index up 3.8% and posting its best weekly performance in more than three months, marking its highest level since early September.
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U.S Treasury yields rose last week, led by longer maturities. Investors remain focused on uncertain prospects for additional fiscal stimulus, and a tumultuous presidential debate provided little clarity. The shift in yields was slight across the board, with the news that President Trump had contracted COVID-19 only slightly souring investor sentiment.
After a strong surge in the summer, equity prices have cooled in recent weeks. The technology sector entered a full-blown correction, and weakness has spread to the broader market.
U.S Treasury yields declined last week, led by longer maturities. Negative market sentiment was prompted by rising numbers of COVID-19 cases in Europe and decreasing expectations for an agreement on U.S. fiscal stimulus.
Stocks fell again last week, marking the first time in over a year that markets declined for four consecutive weeks.
The Fed remains committed to extraordinarily accommodative monetary policy.
Weekly Fixed Income Commentary: Treasury yields increase slightly as the Fed keeps asset purchases steady
Most U.S. Treasury yields increased modestly last week, led by longer maturities.