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The 10-year Treasury yield falls as trade tensions escalate



<p class = "canvas-atom canvas-text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "The 10-year Treasury yield ( ^ TNX ) continued its downward move Thursday, reaching its lowest point since the end of 2017. " data-response time = "22"> The 10-year Treasury yield (^ TNX) continued its downward move Thursday, reaching its lowest point since the end of 2017.

The yield, now at 2.324%, also represents its lowest level so far in 2019.

The move comes amid a rally in bond prices, which move in the opposite direction of bond yields. Investors tend to buy bonds, especially government bonds, when they are worried about the economy.

<p class = "canvas-atom canvas-text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "" The Federal Reserve may not want to hear the message in the falling 10-year yield, but stock market investors would best suited to take off their blinders, "warned Danielle DiMartino Booth, or former Federal Reserve adviser and CEO of & nbsp; Quill Intelligence . "There are still several economic data points that suggest the economy is strong, such as jobless claims. But we have seen enough in the way of negative layoff headlines and slowing manufacturing to indicate claims are the outlier as firms hold on to the skilled employees they struggled to get longer than they would otherwise. "" data-response = "25"> "The Federal Reserve may not want to hear the message in the falling 10-year yield, but stock market investors would be best suited to take off their blinders, ”warned Danielle DiMartino Booth, and forms Federal Reserve advice is and CEO of Quill Intelligence. “There are still several economic data points that suggest the economy is strong, such as jobless claims. But we have seen enough in the way of negative layoff headlines and slowing manufacturing to indicate claims are the outlier as firms hold on to the skilled employees they struggled to get longer than they would otherwise. ”

<p class =" canvas-atom canvas-text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm "type =" text "content =" The data backs up Booth's argument. 1,000, indicating that fewer workers were laid off. But earlier this week, Ford ( F )] announced & nbsp; plans to cut 7,000 white collar jobs. " data response time = "26"> The data backs up Booth's argument. On Thursday, weekly jobless claims fell by 1,000, indicating that fewer workers were laid off. But earlier this week, Ford (F) announced plans to cut 7,000 white collar jobs.

The recent fall in the 10-year yield also surrounds and escalation of trade tensions between the U.S. and China, which has ratified asset classes outside of bonds, like stocks and commodities.

"I would attribute the recent rally in bonds and fall in yields to a flight to safety given uncertainty by the trade war," said Simeon Hyman, global investment strategist at ProShares in an interview with Yahoo Finance.

<p class = "canvas-atom canvas-text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = " text "content =" Experts worry trade tariffs will dilute corporate margins. As Yahoo Finance reported Wednesday, Barclays & nbsp; analysts expect & nbsp; a 10% stock market pullback should tariffs be imposed on all $ 550 billion worth of imports from China. " data response = "29"> Experts worry trade tariffs will drive corporate margins. As Yahoo Finance reported Wednesday, Barclays analysts expect a 10% stock market pullback should tariffs be applied on all $ 550 billion worth of imports from China.

That worry is mission investors into bonds, which is pressuring yields. But falling yields to be a positive for the stock market.

<p class = "canvas-atom canvas-text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "" [Lower bond yields make] stocks more attractive for the long-term as many stocks now have dividend yields in excess of the 10-year Treasury, "said Chris Cordaro, chief investment officer at & nbsp; RegentAtlantic . " data-response time = "31"> "[Lower bond yields make] stocks more attractive for the long-term as many stocks now have dividend yields in excess of the 10-year Treasury," said Chris Cordaro, chief investment officer at RegentAtlantic.

If investors are only going to receive a 2.3% yield in a government bond, they may feel compelled to visit the stock market for a better return.

Falling yields also have implications for the housing market. The yield on the 10-year determines mortgage rates, which are also at their lowest level roughly one year.

"If rates remain persistently low, we could see increased mortgage refinance activity," said Eddy Vataru, portfolio manager or Osterweis Total Return Fund. This is, homeowners looking to swap their existing home loan with a lower interest rate.

<p class = "canvas-atom canvas-text Mb (1.0em) Mb (0) – sm Mt ( 0.8em) – sm "type =" text "content =" Scott Gamm is a reporter at Yahoo Finance Follow him on Twitter @ScottGamm "data-response =" 35 "> Scott Gamm is a reporter at Yahoo Finance. Follow him on Twitter @ScottGamm

<p class = "canvas-atom canvas-text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = " More from Scott: " data-response = "36"> More from Scott:

<p class = "canvas-atom canvas-text Mb (1.0em ) Mb (0) – sm Mt (0.8em) – sm "type =" text "content =" Follow Yahoo Finance on Twitter Facebook ] Instagram Flipboard LinkedIn and reddit . "data-reactid =" 42 "> Follow Yahoo Finance on Twitter Facebook Instagram Flipboard LinkedIn and and reddit [19659014]


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