Market Comment | Trade deal optimism spurs sovereign bonds yields and global equities

Summary

Markets’ risk-on mood intensified this week on the back of increasing U.S.-China trade deal optimism, although the uncertainty remains as the U.S. has not agreed to fully rollback tariffs. Strong services sector figures in the U.S., along with better-than-feared earnings also helped to improve market sentiment.

Key points

• Key points:
• The yield on the 10Y UST and German bonds rose 20bps and 12bps respectively.
• The USD strengthened supported by robust labour and services data.
• Cyclical sectors led the gains in the stock markets with the banking sectors in Europe and the U.S. increasing significantly.

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