Treasuries Lead Global Bond Gains as Equities Lose Momentum

(Bloomberg) -- Treasuries led advances in global bonds as lingering global growth concerns fueled skepticism about recent risk-asset gains and rekindled demand for the safety of government debt.

Yields on 10-year U.S. notes fell toward the lowest level since April as the market was supported by a futures block trade equivalent to $717,000 for each basis-point move. Bonds rose as a global equity rally lost momentum, with U.S. stock-index futures tumbling while shares in Europe and Asia were mixed, following Wednesday’s biggest surge in American stocks since 2009.

Bonds are rising with policy uncertainty “putting pressure on equities,” said Antoine Bouvet, an interest-rates strategist at Mizuho International Plc. There is “little prospect for this uncertainty to abate in the near term. Month-end flows should be supportive in illiquid markets” for debt, he said.

Yields on 10-year Treasuries dropped as much as five basis points to 2.76 percent, while those on similar-maturity German bunds declined two basis points to 0.23 percent.

To contact the reporter on this story: James Hirai in London at jhirai3@bloomberg.net

To contact the editors responsible for this story: Ven Ram at vram1@bloomberg.net, Anil Varma, Keith Jenkins

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