Folks, in the last few days Telecom (anti-yields) co. Verizon has risen, Goldman Sachs & Capital One (pro-yields) have dropped and well, this…
The media are completely on top of the rising yield story, which we began months ago.
Why is Goldman doing this?
Why is COF doing this?
And VZ doing this?
I understand that Verizon had good earnings, but so too did Goldman Sachs as I recall.
Looking around the landscape, it appears some segments that prefer lower long-term yields are firming up. It’s still a mixed bag out there so maybe the key question is why, with such a big spike in long-term Treasury yields are the banks and financials doing so poorly?
We will work this theme going forward, but for now the reminder is that long-term yields are at important potential limit areas while the media are completely on the yields tout, while at the same time the public hates the 10yr T Note and Commercial Hedgers are very net long.
While anything is possible, the indications from a sector like the Financials and contrarian sentiment, combined with our long-term yield continuum (which we maintain for a reason, after all) argue that the ‘RISING YIELDS!!!’ hysteria could have a limited shelf life.