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U.S. 10-year yield on course for biggest monthly rise in over a year

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Bond yields rose on Wednesday, with 10-year U.S. Treasury yields on course for their biggest monthly rise in over a year as investors continued to build up bets that the Federal Reserve will raise interest rates before the year is out.

The growing prospects of a rate hike, perhaps next month, lifted the dollar against many major currencies, pushing it up to a one-month high against the Japanese yen.

The increase in market-based rates and a firm dollar kept a lid on world stock. Japan’s Nikkei 225 bucked the trend, however, its 1 per cent rally driven by the yen’s fall to a one-month low.

U.S. futures pointed to a slight decline at the open on Wall Street ESc1 and Europe’s main bourses hovered close to flat in early trading.

The notable gainer was German bank Commerzbank (CBKG.DE); whose shares rose as much as 4 per cent after a German magazine reported that the country’s biggest lender Deutsche Bank (DBKGn.DE) had in the past considered the idea of a merger with Commerzbank.

Deutsche boss John Cryan, however, poured cold water on the idea, erasing some of the gains in Commerzbank shares.

Paul

The author Paul