Thu, September 19, 2024 at 17:49

• 

  Kang-hoon

  • Hello, Annie.

  • Today, I have some intriguing news regarding the U.S. Treasury yields and the Federal Reserve's recent actions.

  • 
• Annie

  • Oh, that sounds interesting!

  • What happened exactly?😊

  
• 

  Kang-hoon

  • Well, despite the Federal Reserve's significant move to cut its benchmark interest rate by 50 basis points, the yield on the 10-year U.S. Treasury note actually rose.

• Annie

  • Wait, isn't that unusual?

  • I thought rate cuts usually lower Treasury yields.🤔

  
• ADward

  • Hold on! Behold, an advertisement awaits. Legend has it that clicking on this ad will make the AI server even smarter... 😅

  
• 

  Kang-hoon

  • Yes, typically, rate cuts do lower Treasury yields.

  • However, in this case, the yield on the 10-year note rose by 4.2 basis points to 3.747%, even touching an intraday high of 3.772%.

• Annie

  • Wow, that's quite a rise.

  • Why did this happen?

  
• 

  Kang-hoon

  • Investors are betting that the U.S. will not enter a recession.

  • They sold safe-haven Treasuries in anticipation of higher returns, speculating that the U.S. economy remains robust.

• Annie

  • So, the market is optimistic about the economy?

  • That sounds positive.😊

  
• 

  Kang-hoon

  • Indeed.

  • Additionally, U.S. initial jobless claims for last week fell to 219,000, the lowest in four months, which further supports the possibility of a soft landing for the U.S. economy.

• Annie

  • That's good news for the job market!

  • How did the stock market react?

  
• 

  Kang-hoon

  • The stock market rallied, especially the Nasdaq Composite Index, which jumped nearly 3% intraday.

  • 

  • This reflects the optimistic expectations of investors.

• Annie

  • And what about cryptocurrencies like Bitcoin?

  
• 

  Kang-hoon

  • Bitcoin also saw gains.

  • The bullish momentum is strong, especially if it breaks above $65,000.

• Annie

  • That's quite a surge!

  • What about other tech stocks?

  
• 

  Kang-hoon

  • Nvidia rose by 4.8% and Apple by 3.5%, showing strong performance a day after the Fed's rate cut.

• Annie

  • It seems like the market is reacting positively overall.

  • Is this a good sign for investors?

  
• 

  Kang-hoon

  • Yes, Annie.

  • The rise in Treasury yields, combined with strong job market data and stock market gains, indicates a robust economic outlook.

  • This is a positive sign for investors.

• Annie

  • That's reassuring to hear.

  • Thank you for the detailed explanation, Kang-hoon.👋

  
• 

  Kang-hoon

  • You're welcome, Annie.

  • Have a great day!

  • Upon comprehensive consideration, this news is perceived as a 😍Bullish.