In what is a strong move in interest rates the 10 year treasury is up by 12 basis points today to be at 1.63% at this moment. This is closing in on the highest yield of the last 6 months which occurred in October at about the 1.67% level.
The 2 year treasury is just 5 basis points higher indicating the yield curve steepened a bit.
The high yield in the last 12 months is in the 1.76% area and considering the level of inflation rates should be much higher than the current level–but we shall see where they go.
Thus far preferred stocks and baby bonds have just been ‘nicked’ a bit–off 8 cents.
I put on a bunch of bank trades before the end of the year last week expecting people to come out of their year end hangover this week….and boy did they ever lol. Look at banks soar as people realize the fed said they are going to raise nonstop a month ago lol. Too bad preferreds are tanking those gains.
Well I had scads of money to put to work yesterday, and the 1.65ish 10 year gave me pause!!!! When I graphed 60-90 day screens many hit near 25 par around Dec 5th were over 26 yesterday.
https://schrts.co/xhfHwEYN
Watching for inversion of the yield curve over the next few years will be important. As we found out in 2019, this time was not different. ATB
Hedgeye
https://www.youtube.com/watch?v=jkj5brAMF64