US Treasuries rallied across the curve on Thursday, pushing long-end yields to their lowest level in a month as renewed doubts about the durability of the artificial intelligence trade drove investors toward safe havens. Government bond yields fell at least three basis points as Asian equities retreated after earnings from megacap companies failed to ease concerns about stretched AI valuations. The 30-year yield dropped three basis points to 5.38%, its lowest since Sept. 23.
"Sentiment seems to be shakier these days as investors reconsider AI-related assets," said Eugene Leow, senior rates strategist at DBS Bank Ltd. "A bit more caution on profitability, return on investments appear to be creeping in. With US yields still elevated by recent standards, investors may want to hedge off some of these risks by seeking safety in Treasuries."
The move offers some relief to US government bonds, which had hit multi-year highs in recent weeks on fears about widening fiscal deficits and elevated oil prices. Growing skepticism about AI returns has now become a key driver of demand for havens.
A Bloomberg gauge of Treasury returns has climbed about 1.2% in October, after rounding off its biggest monthly drop in almost two years in September. The shift reflects how quickly investor sentiment can change when confidence in high-profile technology bets wavers.
Source: Bloomberg Markets · Summarized by HeadlinesBriefing