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Feb 18
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SHORT
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Benzinga
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Core Durable Goods Orders significantly beat expectations (0.9% vs. 0.3% est.), pointing to a stronger-than-anticipated economy. Strong economic data reduces the urgency and probability of the Federal Reserve cutting interest rates. This pushes interest rate expectations higher, causing bond yields to rise and, consequently, bond prices to fall. Long-duration bond ETFs like TLT are particularly sensitive to these shifts in rate expectations. The data supports a "higher for longer" interest rate narrative. This is directly negative for the price of long-term Treasury bonds. A short position in TLT is a direct trade on the thesis that bond yields will rise in response to this robust economic signal. The market may have already priced in this economic strength, leading to a muted reaction in the bond market. Any subsequent weak economic data or a flight-to-safety event could cause yields to fall (and TLT to rise), invalidating the trade. |
Finnhub - SPY
USA Core Durable Goods Orders (MoM) For Dec. ...
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