The overall sentiment appears to be calmer, but the same can be said for yesterday, when markets actually looked pretty bullish. So far, sentiment is still on a knife edge, as the bond market is also apparently quite tentative.
2-year Treasury yields are flat around 3.97%, while 10-year Treasury yields are up slightly to 3.49%. It still doesn’t take much from yesterday’s sharp plunge as bank jitters reverberated. Heading into European trade, regional bonds will be a big focus amid scrutiny by Credit Suisse and also at the ECB, due later today. German 2-year bond yields saw a big drop yesterday after briefly hitting 3%, falling to their lowest since last December:
Elsewhere, S&P 500 futures are up 12 points, or 0.3%, with Nasdaq futures up 0.3% and Dow futures up 0.2% on the day. It’s not much in terms of change, and mood music can change quickly – as seen yesterday – so I wouldn’t look into it too much right now.
In currencies, the yen remains in pole position with USD/JPY down 0.4% to 132.80 after a big drop yesterday. The dollar is slightly lower compared to the rest of the major currencies, but it mostly eats away at the gains from the previous day.
As things stand, the general rule of thumb is for every minute or hour that goes by that there is no more bad news is actually good news for the markets and general sentiment.