Renewed Selloff Hits the European Bonds and Stocks with Short-lived Stability
On Tuesday, the European bonds and stocks faced another round of renewed selloff as the latest signs that pointed to a stable market did not prove to be continuing for long.
Last week after a short halt, the global turmoil in the bond market continued to flow across the various markets as a large number of the most booming trades which showed gains in the initial part of f 2015 suffered spiky reversals.
The weakness noted in the U. S. Treasury on Monday was the main reason that sparked the latest wave of bond selling. In the U. S market the ten year yields rushed to their highest level of closing in the last five months as investors got ready to sale new debts. They increased further on Tuesday to a high of last six months before it dropped slightly again to yield around 2.24%.
The equities in Europe in the last two weeks have also seen quick reversals after a steady start this year. The chaos in the bond markets forced the investors to rearrange their portfolios and discard the riskier assets. Andreas Koester, UBS Global Asset Management's head of asset allocation and currency said, "We are at a crunch point now. A lot of investors will be hitting their risk limits with all the volatility in bonds, so they have to reduce risk by selling equities."
New Zealand News
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