SocGen

Goldman Warns Bond Yields Are Now "A Threat To Risky Assets"

As Goldman warns, should US 10-year rates move above the bank's ‘fair value’, "this would represent a threat to risky assets." Well, 10-year yields are now at what Goldman estimates is "fair value", which means any additional increases from here could lead to a stock market selloff.

Jeff Gundlach Warns 10Y Yields Above 3% Will "Punish Markets", Would Mark End Of Bond Bull

"We’re getting to the point where further rises in Treasuries, certainly above 3 percent, would start to have a real impact on market liquidity in corporate bonds and junk bonds. Also, a 10-year Treasury above 3 percent in my view starts to bring into question some of the aspects of the stock market and of the housing market in particular."

Presenting SocGen's "Most Frightening Credit Chart"

"I sometimes feel like ‘The Grim Reaper’, scouring the research savannah in a ghoulish quest to harvest bad news with a forceful sweep of my scythe. Imagine then my perverse delight when our credit team produced what is one of the scariest charts I have seen for a very long time." = Albert Edwards

Global Stocks Rise As Oil Dips; US Stock Futures And Dollar Flat

European and Asian markets rose, while U.S. index futures were little changed, with the Dow Jones Industrial Average pushing for yet another record, as traders digested the Italian referendum news, await the ECB's Thursday announcement and reflect in a notably quieter overnight session.  Oil slipped from a 16-month high after 4 straight days of gains.

"Metals Traders On Red Alert" - Chinese Commodity Bubble 2.0 Just Imploded

Industrial metals commodity prices plunged by the most since March in the last 2 days as China’s exchanges (once again) clamped down on speculation by tightening trading rules. As Bloomberg reports, for the second time this year, trading has exploded on the nation’s exchanges, pushing prices of everything from zinc to coal to multi-year highs and sending authorities scrambling to deflate the bubble before it bursts.

How Far Can Bond Yields Rise Before Hurting Equities? Goldman Answers

"... we believe that the equity market is still at a level that can cope with moderately rising bond yields. We estimate that a rise in US bond yields above 2.75% or probably between 0.75-1% in Germany would create a more serious problem for equity markets: at that point we would expect that any further rises in yields from there would be a negative for stock returns." - Goldman Sachs

Juppe And Fillon Clash For Republican Nomination As France Picks Marine Le Pen's Opponent

On Sunday two former prime ministers - Fillon and Juppe - are facing off in a runoff vote for France's center-right presidential nomination, with the victor expected to face a showdown against a resurgent Marine Le Pen in the May 2017 presidential election. Voting opened at 8 a.m. and was set to close at 7 p.m., with the first results likely up to an hour and a half later.

US Treasury Risk Spikes To 3 Year High Versus Stocks

"Riskless" US Treasury bonds are at their riskiest relative to "risky" stocks since the summer of 2013's Taper Tantrum... and at the same time, bonds are 'cheapest' to stocks in over a year...

"Brace For Economic Disruption" SocGen Sees "Sharp Rise In Gold" As India Plans Cap On Cash Holdings

India's 'de-monetization' scheme has caused chaos across the nation, and while SocGen says the government's plan may have some short-term success in curbing so-called 'black-money', investors should "brace for economic disruption" as Bloomberg reports the Indian government is considering a cap on cash holdings for individuals. As SocGen concludes, "people will now be more inclined to park their black income in gold rather than in currency."

What "The Worst Bond Rout In 15 Years" Means For Stocks

"The paradigm has shifted in terms of inflation. Long-end interest rates are dangerous. Make sure you are being really careful about the long-end exposure as we saw this week." - Rick Rieder, CIO for global fixed income at BlackRock.