Late rally on Wall Street lifts European shares after $4trn losses last week 1.00pm GMT Shares may be moving higher in the wake of Friday’s rebound on Wall Street, but US bond yields are also on the rise. Normally bond yields fall when markets rise, but 10 year US treasury yields remain at four year highs. Fawad Razaqzada, technical analyst at Forex.com, said: Have stocks and bond yields decoupled again? Friday’s reversal and today’s bullish follow-through in the stock markets have not been supported by rising government bond prices. As bonds have continued to sell-off, yields have pushed further higher. The benchmark 10-year Treasury yield has now climbed to above 2.9% for the first time since early 2014. Should yields march further higher – which is quite possible with the upcoming US inflation and retail sales data to look forward to on Wednesday – then there is a possibility the equity markets could be in for another volatile week. Indeed, we think that far too much technical damage has been incurred in the indices for the bulls to make a quick comeback and with all guns blazing...So, Friday’s bounce may well prove to be a mere dead-cat bounce for stocks. 12.19pm GMT Meanwhile, Greece is watching the markets carefully with an eye to launching more bond sales before its final bailout program ends in August. Helena Smith reports from Athens: After successfully raising €3bn from its sale of a seven-year bond last week, Athens is now looking to complete at least two more bond sales as part of wider steps to reinforce market access and show investors it can go it alone. The Greek finance minister Euclid Tsakalotos has hinted that future issues could include a three-year bond – launched around the time of the March 4 general elections in Italy – and a ten-year bond. The government has announced plans to build a €19bn cash buffer that would allow the debt stricken country to cover debt repayments once the bailout programme expires. Continue reading...
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