Rising Bond Yields Cast Shadow Over Mega-Cap Tech Stocks’ Soaring Valuations
The recent surge in bond yields has sent shockwaves through the U.S. stock market, with concerns arising about the vulnerability of highly-valued shares in mega-cap technology and growth companies. Seven behemoth stocks, including Apple, Microsoft, Alphabet, Amazon, Nvidia, Tesla, and Meta Platforms, have been the driving force behind the stock market’s gains this year. As […]
Banks toss bets for high-jeopardy bonds
Investors who profited from high-risk bonds created after the financial crisis are now confronted with a new reality: they may not receive their payments. These bonds, known as AT1 bonds or perpetual bonds, were typically sold by banks with a repayment option triggered after five years. In the past, investors received their money back, and […]
How is the bond yield controlled in Japan?
The Bank of Japan’s (BOJ) commitment to controlling bond rates with inflation over the BOJ’s objective is being put to the test by investors, who are fiercely attacking the yield curve control (YCC) of the bank.In an endeavour to permanently reach 2% inflation, the BOJ’s super easy policy sets some short-term borrowing costs at -0.1% […]
ECB tapering talk is purely speculative
ECB policymaker Francois Villeroy de Galhau said suggestions that the European Central Bank (ECB) could begin winding down exceptional bond purchases early are purely speculative. Villeroy is also governor of the French central bank. He pushed back against recent comments by more hawkish members of the ECB who have suggested it could decide to slow bond […]
Raising pace of bond buys not off the table for ECB
ECB Chief Economist Philip Lane said in a French newspaper that the European Central Bank could still increase bond purchases at its June meeting. And this is also when such a move is needed to keep borrowing conditions favourable. Before 2023, he also said unemployment is not expected to return to its pre-pandemic level. From […]