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More investors bullish on US bonds after selloff: JPM

Tuesday, July 19, 2016 - 22:08
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More investors turned bullish on longer-dated US Treasuries in the latest week following a selloff in the bond market last week on reduced fears about global growth and Wall Street hitting record highs, according to a JP Morgan survey released on Tuesday.

[NEW YORK] More investors turned bullish on longer-dated US Treasuries in the latest week following a selloff in the bond market last week on reduced fears about global growth and Wall Street hitting record highs, according to a JP Morgan survey released on Tuesday.

The benchmark 10-year Treasury yield rose 23 basis points last week for its steepest weekly increase since the week of June 5, 2015 when it gained 30.5 basis points, according to Reuters data.

The share of "long" investors who said they were holding more longer-dated US government debt than their portfolio benchmarks rose to 26 per cent from 18 per cent the previous week, JP Morgan's latest survey showed.

The share of "short" investors, who said they were holding fewer longer-dated Treasuries than their benchmarks, increased to 16 per cent from 11 per cent last week, JP Morgan said.

The difference between long and short investors, or net longs, grew to 10 per cent from 7 per cent.

The share of "neutral" investors, who said on Tuesday they were holding amounts of longer-dated Treasuries that match their benchmarks, fell to 58 per cent from 71 per cent the previous week.

In early Tuesday trading, the 10-year Treasury yield was down 2 basis points at 1.566 per cent after hitting a record low of 1.321 per cent on July 6, Reuters data showed.

REUTERS

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