It was only a week ago that the 10 year treasury closed the week at 2.41% and now they are trading at 2.52%–after spiking to the 2.55% earlier.
Some economic data in the U.S. has been fairly strong and China released numbers that show improvement from where they have been recently. Not that we fully believe the numbers released from the government, but they are what the markets look at so we have to go with the flow.
With this movement we could see some ‘give back’ in income issues, although thus far that has not been the case–but most certainly the euphoria has subsided.
Our best guess now is that if rates move up toward the 2.60% area we could see some “nervous nellies” start dumping some of their holdings of preferred stocks and baby bonds. If that does occur we will be waiting with money in hand to add to our positions as we have plenty of cash after locking down profits during the last couple of months.