Five chart to start your day

The bond and equity market rout continues

There’s a sell-off happening right now. Both bonds and equity markets are being hit hard.

Central banks globally are raising interest rates to tackle inflation, making borrowing costlier for governments and businesses. Investors are apprehensive over the possibility of a recession. This anxiety has led to a retreat from stocks and bonds.

Market unease has intensified. On Thursday last week for instance, the 10-year US Treasury yield reached a peak not seen in 16 years. Meanwhile, the S&P 500 index dropped to a level not witnessed since June 2022.

Rising interest rates, looming recession concerns and geopolitical instabilities are causing concern. The five charts we have today reflect these worries.

Let’s kick start with something I published last week – the great bear steepening. Watch this video! Take a look at the long end of the US yield curve rising dramatically. This is intraday one-hour apart data. It’s pretty dramatic.

1. The great bear steepening just keeps on going

Coming up:

2. The equity risk premium on 10-year US Treasuries has vanished

3. In Germany house prices are falling in real terms

4. LatAm’s GDP per capital trails China’s but vastly exceeds India’s

5. The $105 trillion global economy

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