- As investors grew more concerned about rising borrowing costs, Treasuries intensified a selloff, pushing the 10-year yield to a nine-month high.
- European stock prices dropped 0.6%, while S&P 500 futures contracts suggested that yesterday's losses might be extended. For the fourth day in a row, the dollar increased. The announcement that Bill Ackman, founder and CEO of Pershing Square Capital Management, is shorting 30-year Treasuries as a hedge against the effects of rising long-term rates on stocks added to the pessimistic atmosphere.
- Investors will be paying close attention to the bond market until the US delivers its quarterly financing report next week, according to analysts at ING, as a result of the quick increase in Treasury yields over the past four days that has "cast a shadow" across risk assets. For any indications that the American economy is expanding faster than anticipated, analysts will keenly monitor today's economic data, which includes jobless claims and a gauge on the US services sector. Later in the day, Apple and Amazon are scheduled to report.
- Traders pare BoE bets, and see the key rate peaking below 5.75%.
- ECB's Panetta: I will decide in September whether to pause or not.
- ECB's Panetta: Risks to the inflation outlook have become more balanced, while risks to the economic outlook have shifted to the downside.