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China eases and US yields surge
This week saw the PBOC cut interest rates by 10bps and US bond yields rise higher again on expectations that the Fed may need to hike by as much as 50bps at March’s meeting. Fed fund futures are now pricing in more than 4 hikes this year and this has further weighed on US stocks. Yields and equities can rise together, but if the Fed is hiking as growth and inflation are peaking the risk is that this sets off further selling in equity markets. The Nasdaq and the S&P500 broke lower through key support on Tuesday. Earnings season will be hotly watched now. If companies start to revise future growth and earnings ... (full story)