Treasury yields rose across maturities as US technology shares rebounded, reducing haven demand for government debt. The 10-year yield climbed over six basis points to 5.14% as traders priced in Federal Reserve interest-rate hikes for next year and another quarter-point increase in December. The Nasdaq 100 Index gained 1.2% Monday on renewed artificial-intelligence trade following a recent steep selloff.
Market positioning remains tenuous after recent whipsaw moves, keeping investors away and exacerbating daily volatility. Higher oil prices also pressured bonds, with US crude hitting a one-month high and Brent touching a five-month peak. UBS strategists raised their year-end 10-year yield target to 5.2% based on a more hawkish Fed path and higher oil-price assumptions.
Meanwhile, new corporate bond issuances, including a nearly $7 billion offering from Kimberly-Clark to finance its Kenvue acquisition and a Walmart debt sale, diverted investor attention from Treasuries. French yields led European gains, with the 10-year climbing to nearly 4.95%, the highest since 2002, amid cost-of-living riots and downgrade risk from Moody's. Bond strategists note short-term Treasuries could rally as the market prices in about a 20% chance of a rate hike at the October 28 policy decision.
Source: Bloomberg Markets · Summarized by HeadlinesBriefing