Rising bond yields continue to weigh on financial markets
Mar. 30, 2021 8:36 AM ETTechnology Select Sector SPDR ETF (XLK), VGT, QQQ, IEF, HYGQQQ, IEF, XLK, VGT, HYGBy: Jason Capul, SA News Editor9 Comments
- Bond yields continue to climb higher in early morning trading across the globe.
- Currently, the U.S. 10-Year Treasury yield is up five basis points to 1.76%, touching its highest level in more than a year. Furthermore, the U.S. 30-Year Treasury yield is also up three basis points to 2.44%.
- From a global viewpoint, bond yields are clambering higher as well. The German 10-Year Treasury yield is up five basis points, and the U.K 10-Year Treasury yield has gained six basis points.
- Rising yields in the United States places continued pressure on the Nasdaq 100, as the index is currently lagging behind the S&P 500 and Dow Jones in the pre-market. At the moment, the Nasdaq is trading -0.74%.
- Since the Nasdaq 100's all-time high back on February 16th, 2021, the index has fallen -7.40%, and the U.S 10-Year Treasury yield has risen fifty basis points. For a visual effect, see a chart below of the inverse relationship since February 16th, 2021.
- Beneath are a handful of technology and fixed income-related exchange traded funds that have been affected by rising yields in some capacity.
- Technology Select Sector SPDR ETF (NYSEARCA:XLK) closed Monday -0.52% and is -0.76% in the pre-market.
- Vanguard Information Technology ETF (NYSEARCA:VGT) closed Monday -0.75% and is -1.38% in the pre-market.
- Invesco QQQ ETF (NASDAQ:QQQ) closed Monday -0.03% and is -0.68% in the pre-market.
- iShares 7-10 Year Treasury Bond ETF (NASDAQ:IEF) closed Monday -0.34% and is -0.27% in the pre-market.
- iShares iBoxx $ High Yield Corporate Bond ETF (NYSEARCA:HYG) closed Monday +0.06% and is -0.20% in the pre-market.
- Read more about the steepening yield curve and how the bond market is tightening.