Timmer Questions 60/40 Portfolio Revival Amid Weakening Stock-Bond Link
Fidelity's Jurrien Timmer questions the 60/40 portfolio comeback as higher Treasury yields sustain a positive stock-bond correlation.
Asia-Pacific markets: Oil steady near highs, Japan data misses, crypto falls on US Senate vote.
Highlights:
On Tuesday, oil prices remained near recent highs as private data from the American Petroleum Institute indicated increases in inventories of crude, gasoline, and distillates, ahead of the official US government report due Wednesday morning.
In the Middle East, a coalition led by Saudi Arabia reported that it intercepted a Houthi drone before it could enter restricted airspace around Mecca. The coalition called protecting the two holy mosques a 'red line' and stated it would take appropriate actions against the group.
Turning to data, Japan's machinery orders for July came in below expectations, and the nation's August trade deficit widened more than anticipated as imports grew faster than exports. These numbers injected caution into Japan's growth and capex outlook. The yen weakened briefly after the release but later bounced back to trade nearly unchanged.
Major currency pairs traded within a subdued range ahead of the Federal Open Market Committee decision, as markets broadly price in a rate hike. Likewise, equities in Japan and South Korea moved in narrow, cautious ranges as investors awaited the FOMC outcome.
Crypto markets weakened on Tuesday after US developments. The Senate did not advance the Clarity Act via a cloture vote, which prevented establishing a unified federal regulatory framework for crypto, leaving oversight under current SEC and CFTC rulemaking. Bitcoin's losses deepened on the news, although markets had largely anticipated the outcome.
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Disclaimer: this article comes from third-party media and is provided for reference only. It does not constitute investment advice. Crypto and other financial products carry significant price volatility risk, so please make your own decisions carefully.
Fidelity's Jurrien Timmer questions the 60/40 portfolio comeback as higher Treasury yields sustain a positive stock-bond correlation.
The Bank of England is expected to raise Bank Rate to 4% on Thursday, its first hike of this cycle, with inflation at 3.5%.
Japan's services PMI rose to 51.7 in October, but the composite PMI slipped to 52.1, a five-month low, as hiring slowed and cost pressures persisted.
September data showed Australia's goods surplus at about A$2.8 billion, a seven-month peak, with LNG and metals exports up and gold imports down sharply.