Trump’s $337 Billion Bond Upset Casts Shadow on Rallying Stocks
- Bigger chance of Fed hike under Trump presidency, Westpac says
- U.S. 10-year note yield jumped most since 2013 on Wednesday
Should Trump Give Reason to Fear a Bond Selloff?
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Investors saw $337 billion wiped off the value of securities that comprise an index of global bonds in a single day Wednesday following Donald Trump’s election as President, the flipside of global upswing in stocks and commodities.
While Trump’s spending plans have pushed equities, raw materials and the dollar higher, bonds have declined on speculation he’ll need to sell more debt and on concern faster growth will lead to a surge in inflation, which erodes the value of fixed-income securities. The selloff deepened on Thursday, pushing 10-year Treasuries down for a fourth day and sending yields in Italy to the highest level since September 2015.