Investors are fleeing bonds and grabbing commodities in hopes of economic recovery, while European equities are trading lower

by

Investors continued to flee from bonds and commodities in hopes that the rollout of vaccines will revive the global economy, causing European stocks to fall on Monday.

The return on the benchmark 10-year Treasury TMUBMUSD10Y,
1,369%
rose to 1.37% after an increase of 14.5 basis points last week. The return on the 10-year British gold-plated TMBMKGB-10Y,
0.709%
and German bund TMBMKDE-10Y,
-0.301%
also increased. Revenues move in the opposite direction of prices.

According to published reports, British Prime Minister Boris Johnson will unveil England’s reopening plan on Monday, which will start with schools and expand to golf courses and tennis courts in late March. The country’s leave plan is extended over the summer.

Globally, new coronavirus cases are down after a peak in January.

Copper HG00,
+ 0.55%
and palladium PA00,
+ 0.50%
led a rise in much of the metal complex on Monday.

“One of the (many) hot stories in the financial markets right now is the surge in base metal prices, where copper, tin, nickel, lead and zinc are all gathering on the basis of global hopes for recovery and challenges in offer. This comes at a time when investors are coming to the conclusion that the Fed really wants inflation to hit high and that bonds are certainly not an asset class to hold in the current environment. The main challenge facing the financial markets is whether bond sell-offs can prove orderly enough for reflationary asset classes, including equities, to thrive, ”said ING strategists.

After recording a 0.2% increase last week, the Stoxx Europe has 600 SXXP,
-0.84%
fell 1.1%. US Equity Futures YM00,
-0.64%

ES00,
-0.83%

NQ00,
-1.27%
were also lower.

Miners including BHP Group BHP,
+ 0.61%
and Rio Tinto RIO,
-0.83%
advanced, and banks including HSBC Holdings HSBA,
+ 0.78%
were helped by the steeper yield curve, indicating higher margins.

Playing in the technical sector such as microchip equipment manufacturer ASML Holding ASML,
-2.45%
fell. Also lower were companies that did well during the pandemic, such as fast food delivery company Delivery Hero DHER,
-4.15%
mealkit preparer HelloFresh HFG,
-4.89%
and supermarket delivery company Ocado OCDO,
-4.06%

Source