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All That Matters
Monday was instructive for anyone who still doesn't understand the dynamic currently governing markets.
US 10-year yields dropped for the first day in five and tech stocks surged, even as equities gave some back into the close on Wall Street.
The long-end led the rally, bull flattening the curve. The Nasdaq 100 jumped by nearly 2%.
That isn't a coincidence. Treasurys didn't "hold gains despite buoyant stocks." Rather, stocks were buoyant because bonds were bid.
As illustrated rather poignant
Honestly, why wouldn’t the Fed allow rates to drift a bit higher?
It gives them more room for a future drop, if necessary.
Exactly. Why does the Fed have to chase the bond market? Optics? Everyone knows the Fed owns the bazooka and can use it whenever it chooses.
Because equities should only go up, never down!!