10 year above 2.75%
The higher yields seem to be putting a little selling pressure on the stocks.
The 30 year moved above 3% level (first time since May 2017). The 10 year is above 2.75% and the 3 major indices are back in the red (they have been all around today). The discount rate of future earnings are being calculated at a higher rate, and that lowers earnings (at least in theory).
Other influences that have helped yields is the Atlanta Fed came out with a 5.4% GDP growth estimate for 1Q growth, which is a bit up there. Of course it is early in the quarter and the model may not be working on all cylinders. Nevertheless, it is a shocking number/thought.
If there is truth to it, could there be a 50 bp hike down the road?
PS Unit labor costs also rose 2.0% in the 4th quarter.
Amazon is down -$30 or 2% before earnings after the close.
As for the dollar:
- The EURUSD is trading at the highs
- The GBPUSD is at NY session highs and looks to test the London morning high.
- The USDCHF is looking like it might go back and test the August 2015 low at 0.9256 (trades at 0.9273)
- The USDCAD is trading near its lows for the day.
