3 hrs ago
Yields Ease as AI Optimism Pushes Stocks to Records
US government bond yields dipped on Tuesday after reaching very high levels.
Yields are the returns investors get for lending money to governments.
Even after falling, they remained high compared with many past years.
US stocks rose, and the S&P 500 and Nasdaq finished at record highs.
Investors were hopeful about technology companies and the growth of artificial intelligence.
They were also waiting for notes from the Federal Reserve’s latest meeting to learn more about possible interest-rate decisions.
Bond markets in France and Germany also calmed somewhat.
Oil stayed near $100 a barrel, while worries about inflation, government debt, and energy supplies continued.
The 10-year US Treasury yield fell to 5.269% from Monday’s 5.310% close, its highest since 2002.
The S&P 500 and Nasdaq Composite ended Tuesday at record closing highs, while the Dow also rose.
Investors awaited Wednesday’s Federal Reserve meeting minutes for clues about the economic outlook and interest rates.
Goldman Sachs estimated S&P 500 earnings could rise 27%, with more than half of the expected growth linked to AI infrastructure spending.
French and German 10-year bond yields fell, while Brent crude settled around $100.60 a barrel.
- Who
- Investors in US and European financial markets.
- What
- US Treasury yields eased, major US stock indexes reached record closing highs, and European bond yields fell.
- Where
- The United States and European bond markets, including France and Germany.
- When
- Tuesday; Federal Reserve meeting minutes were due Wednesday.
- Why
- Yields eased after recent sharp increases, while investors weighed interest rates, inflation, government debt, oil prices, and expectations for AI-linked earnings.
Key facts
- 10-year US Treasury yield
- 5.269%, down from Monday’s close of 5.310%
- 30-year US Treasury yield
- 5.659%, down less than 1 basis point
- 2-year US Treasury yield
- 4.80%, down more than 3 basis points
- S&P 500
- Rose 0.58% to a record close of 7,818.93
- Nasdaq Composite
- Rose 0.45% to a record close of 27,599.79
- Brent crude
- Settled at about $100.60 a barrel
- Fed rate outlook
- Markets priced in about an 80% chance that rates would remain unchanged at the next meeting
Quotes
RBC Capital Markets analysts
Analysts at RBC Capital Markets discussing France’s budget and fiscal outlook.
“Beyond next year, France would need to deliver a similar pace of consolidation for four further years to achieve a 3% budget deficit by 2030–a pace no French government has sustained in the modern era.”
financialexpress.com
“The global economy has remained resilient.”
financialexpress.com
Sources
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