Treasuries rise as China slowdown dents stocks

Markets 1/14/2019, 3:00 PM
Treasuries rise as China slowdown dents stocks

Markets favored assets with lower risk on Monday and concern prevailed about China's trade balance and its implications on the negotiations with the government in Washington. Imports suffered a heavy blow in December, according to the latest statistics, which raised questions about the health of the world's second-largest economy. Furthermore, trade surplus with the United States reached a record last year, which may further complicate the talks. Benchmark sovereign bonds rallied, taking down yields. The yen held the day's gains, while gold pared most of the early advance.

The imbalance in exchange is one of the main disputes that led to the introduction of protectionist measures on both sides. They are currently refraining from escalating the trade war. Of note, investors are waiting for the result of the Brexit vote in Parliament in London.

The US two-year yield declined to 2.537% at 8:57 am ET, compared to the declines to 2.69% for the 10-year note and to 3.037% in the yield on the 30-year bond. Prices of corresponding futures added 0.02%, 0.09% and 0.02%, respectively. Germany's ten-year yield weakened to 0.219% and the British equivalent dropped to 1.156%.

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F ZB-0.15%

144.8125
Chart for: F ZB 3/19

F ZN-0.14%

121.3281
Chart for: F ZN 3/19

F ZT-0.04%

105.9258
Chart for: F ZT 3/19