Visitors Now:
Total Visits:
Total Stories:
Profile image
By ETF Daily News (Reporter)
Contributor profile | More stories
Story Views

Now:
Last Hour:
Last 24 Hours:
Total:

Bond Market Craters On Shocking Trump Victory

Wednesday, November 9, 2016 8:25
% of readers think this story is Fact. Add your two cents.

(Before It's News)

While equities have mostly erased their early losses today following Donald Trump’s unexpected victory last night, the bond market has not been so lucky.

Interest rates are flying higher this morning as investors dump Treasuries on renewed hopes of a December rate hike — and possibly more subsequent hikes as well. Donald Trump has repeatedly said in the past that the Federal Reserve hasn’t been doing its job properly, and the President-elect may now have the necessary influence to force the Fed’s hand.

10-Year Treasury yields surged a massive 11.5 basis points, to six-month highs of 1.976% on the back of Trump’s election. Despite her reluctance to comment on such matters, Hillary Clinton had been seen as much more dovish and accommodative in terms of interest rate policy, while Trump was publicly quite hawkish.

Trump had also claimed recently that the Federal Reserve was keeping rates low prior to the election in an effort to help Clinton’s campaign. While that claim is far-fetched, it doesn’t seem unlikely that Trump could flex his newfound political muscle to help influence rates higher.

Bond investors will want to keep a close eye on these developments over the coming days to see if this initial shock is a one-time event, or if longer-term bonds are at serious risk for big principal losses.

The iShares Barclays 20+ Year Treasury Bond ETF (NASDAQ:TLT) fell $3.12 (-2.40%) to $126.97 in Wednesday morning trading. Year-to-date, the largest fund tied to long-term Treasuries has gained 5.31%.

TLT-2016-11-09

You are viewing an abbreviated republication of ETF Daily News content. You can find full ETF Daily News articles on (www.etfdailynews.com)

Report abuse

Comments

Your Comments
Question   Razz  Sad   Evil  Exclaim  Smile  Redface  Biggrin  Surprised  Eek   Confused   Cool  LOL   Mad   Twisted  Rolleyes   Wink  Idea  Arrow  Neutral  Cry   Mr. Green

Top Stories
Recent Stories

Register

Newsletter

Email this story
Email this story

If you really want to ban this commenter, please write down the reason:

If you really want to disable all recommended stories, click on OK button. After that, you will be redirect to your options page.