Positive U.S. labor market news inspired a rally on Friday; however, earlier in the week, concerns about rising Treasury rates pushed U.S. stock markets lower. The yield on 10-year Treasury notes rose as high as 1.6 percent on Friday, following the jobs report, before retreating to 1.5 percent, reported Yun Li of CNBC.

Last week, investors disdained companies they have previously favored, according to a source cited by Ben Levisohn of Barron’s. The source analyzed the market by screening “…for stocks that had supersized 12-month returns at the end of 2020, faster relative growth, price/earnings ratios that were more than double that of the Russell 1000, and a minimum market capitalization of $10 billion…all of which fell at least 9 percent this past week.”

Students of financial markets may have noted a historically unusual event last week.

On Thursday, the yield on 10-year U.S. Treasury notes briefly matched the dividend yield for the Standard & Poor’s (S&P) 500 Index. This type of convergence is uncommon. In normal times, the yield on 10-year Treasuries tends to be higher than the dividend yield of the S&P 500.

It’s a contrarian’s dream come true.

Contrarian investors like to buck the trend. They buy when other investors are selling and sell when others are buying.

Last week, Bank of America (BofA) delivered a contrarian’s dream. BofA’s monthly survey of 225 global asset managers, who are responsible for $645 billion in assets under management, showed the managers were almost fully invested, according to CNBC.

Way back, when radio disk jockeys played 45-rpm vinyl singles, the A-side of a disk was the song the record company was promoting and the other side – the flip side – held a song that sometimes had an equal or greater impact. For instance, the flip side of Queen’s We Are the Champions was We Will Rock You.
When it comes to the economy and financial markets, flip sides can have significant impact, too.

It’s not a black diamond ski run yet, but the yield curve for U.S. Treasuries is steeper than it has been in a while.

A yield curve is the line on a graph showing yields for different maturities of bonds. Yield curves provide insight to bond investors’ perceptions about the economy. There are four basic types of yield curves.

They say people watching the same event often see different things. That seems to have been the case last week when share prices of a few companies experienced tremendous volatility. Some cast the events as a David vs. Goliath morality tale, however, Michael Mackenzie of Financial Times saw it differently. He wrote, “…a speculative surge […]

Last week, as COVID-19 vaccination efforts continued, there was speculation about stock market corrections and asset bubbles.

Investors were rocked by economic data showing the economy hit the brakes hard in December. Last week, major U.S. stock indices decelerated as investors gaped at the economic damage caused by the rising number of coronavirus cases around the world. There have been more than two million COVID-19 deaths globally, with more than 390,000 deaths […]

The event at the United States Capitol building had a resounding impact around the world, but it didn’t deter global stock markets.

Last week, investors weighed the violent disruption of America’s 2020 presidential election process against the outcome of the Senate runoff in Georgia, and decided the latter was more significant.