Get 40% Off
🤯 This Tech Portfolio is up 29% YTD! Join Now to Get April’s Top PicksGet The Picks – Just 99 USD

Markets Nervy Amid Higher Yields; FTSE > 200 DMA

Published 23/04/2018, 15:55
Updated 25/04/2018, 09:10

Sentiment rebounded mid-Monday, with European shares turning positive and Wall Street opening narrowly higher after bond yields slipped back from earlier highs. The US 10-Year treasury yield on the cusp of 3% is on everybody’s radar. A breakout beyond 3% in treasuries is a psychological line in the sand for many institution investors allocating money between bonds and equities. In actual fact, it may just need a clear move one way or the other past 3% to remove the uncertainty and allow traders to move on.

The strength in yields put pressure on the typically highly indebted utilities sector. The FTSE 350 Utilities index dropped was worst sectorial performer on the day. Higher yield stocks were outpacing lower yield by an average of 0.55% in the last hour of trading across the FTSE 350. A higher yield environment and the prospect of rosier first quarter earnings helped push bank stocks higher. Shares of UBS dropped despite generally well-received Q1 results. This in keeping with the reaction to US bank earnings where results did not meet the lofty expectations.

The afternoon rebound in the stock market carried the FTSE 100 over its 200-day moving average for the first time since February’s correction. The 200 DMA is used by many traders to distinguish a bullish or bearish trend in the market. The ongoing downturn in the pound since the dovish utterance from the Bank of England’s Mark Carney has again helped the FTSE outperform other global equity benchmarks.

Disclaimer: The information and comments provided herein under no circumstances are to be considered an offer or solicitation to invest and nothing herein should be construed as investment advice. The information provided is believed to be accurate at the date the information is produced. Losses can exceed deposits.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.