10-Year Yields:
Greece 19.49%
Portugal 8.86%
Spain 6.02%
Italy 5.19%
Belgium 2.59%
France 2.24%
Austria 2.09%
Netherlands 1.79%
Finland 1.79%
U.K. 1.75%
U.S. 1.66%
Germany 1.51%
Spain 2-Year Yield 3.41%
Spain 5-Year Yield 4.75%
Spain 10-Year Yield 6.02%
Spain 30-Year Yield 6.63%
2-10 Spread = 261
Italy 2-Year Yield 2.42%
Italy 5-Year Yield 4.15%
Italy 10-Year Yield 5.19%
Italy 30-Year Yield 5.86%
2-10 Spread = 277
Keystone has not posted the European bond yields for about six weeks. Once Draghi announced that he would support the euro by all means necessary, on 7/26/12, yields moved lower and Europe calmed. Over the last day in Spain, however, police are firing rubber bullets into the rioting crowds. Greece has a strike underway today. Markets appear to have given up waiting for Spain to request a bailout; Rajoy is playing games and does not appear in a rush to request the bailout since the lower yields takes the pressure off. The lower yields came about because of Draghi's jawboning and action, however, and this action assumed that Spain would request the bailout. Spain's 10-year moved back above 6% a short time ago. This signals trouble returning to Europe.
A Germany debt sale this morning did not go all that well which should lead to higher yields but Germany trickles a shade lower in yield. This tells you the move to safety is occurring again in light of the riots and drama developing on the European continent. The spreads in general, Spain-Germany, Italy-Germany, the 2-10 spreads for Spain, the 2-10 for Italy, are all relatively well-behaved still yet. The Spain 10-year yield up over 6% again now which requires a renewed focus on the European bond yields as time moves forward.
Over the last few days, the U.S. 10-year yield has dropped from 1.8% to 1.75% to 1.7% and now lower. Lower yield = lower equity markets; higher yield means higher equity makets.
The games have begun - Gold broke down today under its long established sideways channel... Couldn't seem to get the finger to click sell when it was 1760 but of course I took the knife catching trades for pennies instead of dollars. Its symptomatic of fear these markets can really get the best of you even when you know its going to drop you still sometimes get the trades wrong.
ReplyDeleteAll the best to all today especially KS - its not easy finding a fountain of wisdom to draw from. That 30min SPX chart was a perfect call perhaps with a little more good fortune we all can make some serious bank on the up coming opportunity's in this market. I don't know about anyone else I have haven't had a really big rip yet and I'm looking forward to it.
Hello MCAP, the euro 128.30 is key. If that fails it will be game-on for the bears. If the euro tests but bounces, or simply stays above 128.30 and higher, that will say the bulls will likely receive the bounce.
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