What does rising US bond yield mean for equity investors?
In the early cycle of yield inversion, the equity market tends to head southwards as investors prune their exposure to risky assets.
Synopsis
The difference between the 10- and 2-year treasury yields in the US, a widely-acknowledged recession indicator, is just 20 basis points away from turning negative. A year ago, this was 140 basis points on the positive side. The higher yield on 30-year US treasury bonds over the five-year paper shrank to just 12 basis points, the narrowest in 15 years.
ET Intelligence Group: Equity as an asset class, which has been under pressure after losing more than $12 trillion of market value globally this year, could witness more headwinds as recession indicators have started flashing warning signs. The difference between the 10- and 2-year treasury yields in the US, a widely-acknowledged recession indicator, is just 20 basis points away from turning negative. A year ago, this was 140 basis points on
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