Morning Minutes

Stocks Slump as Investors Digest Rising Treasury Yields




Coming off of a mixed Monday, world stock markets continue to struggle. US Index Futures are down 0.4%-0.6%, having weakened as the morning progressed, while in Europe, the Dax is down 0.8% and the FTSE is down 0.2%. In Asia Pacific action, the Hang Seng gave back all of Monday’s 2.5% pop, while the Nikkei fell 1.6%.

Traded interest rates remain on the rise with the US 10-year Treasury Note Yield climbing above 3.70%. Overnight the Reserve Bank of Australia kept its benchmark rate on hold but indicated that it’s fight against inflation is not over and hinted that future interest rate increases remain possible.

Today is relatively quiet for economic news, giving investors another chance to think about yesterday’s slightly encouraging US Manufacturing PMI, slightly disappointing Canadian Manufacturing PMI, and in-line US Construction Spending. Tonight and tomorrow bring, Service PMI reports from around the world, US ADP Payrolls (street 153K), a Reserve Bank of New Zealand meeting (no change expected), Eurozone Retail Sales.

Energy markets are mixed this morning with US Crude Oil down 0.4% and still trading below $90.00, while Natural Gas is up 1.0%. Investors may be looking ahead to tomorrow’s OPEC+ meeting looking for any changes to current production quotas/levels, and the API/DOE weekly US inventory reports due this afternoon and tomorrow morning.  

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Colin Cieszynski, Chief Market Strategist

Colin Cieszynski, CFA, CMT
Chief Market Strategist
+1 (647) 282-4428

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