HomeFinancial MarketsBonds Rally, Stocks Pause Following Further Inflation Data

Bonds Rally, Stocks Pause Following Further Inflation Data

Bonds rose and equity futures stagnated on Wednesday following a fresh batch of inflation data that showed that producer prices fell more than expected in November. Treasury yields fell four basis points to 3.89%, while Germany’s 10-year yield also fell by four basis points to 1.98%. Britain’s 10-year yield slumped by nine basis points to 3.56%.

Futures listed on the S&P 500 and the Nasdaq 100 were both down by 0.2%, while contracts on the Dow Jones Industrial Average remained relatively unchanged. In Europe, stocks on the Stoxx 600 also remained stagnant, as did the MSCI Emerging Markets Index. This comes after U.S. stocks rallied in recent weeks off the back of increasing bets that the Federal Reserve would introduce interest rate cuts as soon as March next year.

Among the incoming economic data that markets will wait to digest later this week are existing home sales figures, due later on Wednesday, and GDP data due on Thursday. Friday will see the release of the latest personal consumption expenditures – the Federal Reserve’s preferred inflation gauge—which is expected to provide some guidance on the direction of the Fed’s monetary policy.

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