Investors continued to flee bonds and pick up commodities in the hope that vaccine launches would boost the world economy, lowering European equities on Monday.
The yield on the standard ten-year treasury TMUBMUSD10Y,
rose to 1.37%, after rising 14.5 basis points last week. The proceeds of the ten-year British gilded TMBMKGB-10Y,
a German alliance TMBMKDE-10Y,
also increased. Yields move in the opposite direction of prices.
British Prime Minister Boris Johnson will unveil England’s reopening plan on Monday, which will start with schools and extend to golf and tennis courts by the end of March, according to published reports. The country’s country plan is being expanded through the summer.
Worldwide, new cases of coronavirus have declined after peaking in January.
Copper HG00,
a palladium PA00,
led a march into many of the metal complex on Monday.
‘One of the (many) hot stories at the moment in the financial markets is the rise in prices of base metals, where copper, tin, nickel, lead and zinc are all converging due to global recovery hopes and supply challenges. This comes at a time when investors are thinking that the Fed really wants inflation to warm up and that bonds are certainly not an asset class to hold in the current environment. The most important challenge for financial markets is whether the sale of bonds can be orderly enough to allow reflective asset classes – including equities, to flourish, ”said strategists at ING.
After the Stoxx Europe 600 SXXP squeaked 0.2% last week,
it fell 1.1%. US futures contract YM00,
ES00,
NQ00,
was also lower.
Miners including BHP Group BHP,
in Rio Tinto RIO,
advanced, and banks including HSBC Holdings HSBA,
was helped by the weakening of the yield curve, indicating higher margins.
Technical sector plays such as the manufacturer of microchip equipment ASML Holding ASML,
fell. Also lower were companies thriving during the pandemic, such as the delivery company Fast Hero DHER,
meal preparation HelloFresh HFG,
and supermarket delivery company Ocado OCDO,