Financial News

US 10-Year Treasury Yield Plummets 10.9 Basis Points to 4.24% Pre-Bell; 2-Year Rate Sinks 10.5 Basis Points to 3.66%

US Treasury Yields Sink Pre-Bell as Investors Await FOMC Minutes After Iran Ceasefire Deal

War Outlook Blunts Japan's Economy Watcher Survey Results

The Middle East war and rising oil prices undercut confidence of Japan's frontline service workers in March, reported the Cabinet Office on Wednesday.The nation's Economy Watchers Survey index fell to 42.2 in March from 48.9 in February, striking the lowest level since February 2022.The monthly Japan Economy Watchers Survey measures the economic sentiment of workers in consumer-facing industries, such as taxi drivers, hotel staff, and restaurant employees.A survey index reading above 50 indicates optimism among workers, while a reading below 50 points to pessimism.The Economy Watchers survey is conducted from the 25th to the 30th of each month.The Economy Watchers Survey Outlook index in Japan decreased to 38.7 points in March from 50 in February, sinking to the lowest reading since December 2020.The view of the economy watchers indicated in the March survey is that "the economy shows weakness in the recent recovery movements, influenced by the downward pressure on sentiment due to the Middle East situation," reported the Cabinet Office.The Economy Watchers Survey is somewhat at odds with Japan's service-sector purchasing managers index (PMI), which struck 53.4 in March, down from 53.8 in February, but still well above the 50-mark that separates growth from contraction, reported S&P Global.The S&P Global survey was conducted from March 11 through 25, a period preceding the Economy Watcher Survey, possibly suggesting the mood in the service sector soured as the Middle East war remained unresolved.

India Leaves Key Interest Rates Unchanged at 5.25%

India left benchmark interest rates steady as the Middle East conflict further weighed on inflationary pressures.The Reserve Bank of India decided to keep the policy repo rate unchanged at 5.25%, according to a Wednesday press release.The decision was in line with the forecast made by 69 out of 71 analysts surveyed by Reuters.The RBI's Monetary Policy Committee considered the disruption brought by the war in Iran, as the closure of the Strait of Hormuz triggered oil price shocks. The spike in energy and commodity prices is likely to lift inflation, prompting the central bank to predict the consumer price index for the fiscal year of 2026-2027 to be at 4.6%, with the first-quarter CPI at 4%.The expected first-quarter CPI would be a jump from the February CPI of 3.21% and January's 2.74%.The U.S. and Iran only recently reached a deal to suspend the missile attacks for two weeks after President Donald Trump threatened to wipe out Iran unless it reopens the Strait of Hormuz. Shares of state-owned Indian Oil Corporation (NSE:IOC, BOM:530965) soared less than 7% following the news of the 11th-hour ceasefire agreement, which brought down oil prices below $100 per barrel."The MPC opined that the intensity and the duration of the conflict and the resultant damage to the energy and other infrastructure add risk to the inflation and growth outlooks," RBI Governor Sanjay Malhotra said in a statement. "However, the fundamentals of the Indian economy are on a stronger footing, providing it with greater resilience to withstand shocks now than in the past."Moreover, the central bank lowered its real gross domestic product outlook for the fiscal year to 6.9% from 7.6%, with the first-quarter GDP predicted at 6.8%.ANZ expected that Asian countries, including India, would keep interest rates at bay to quell the impact of inflation and price pressures."We do not doubt that growth in the region will weaken but, at the same time, we are mindful that a non-reactive policy stance that aims to sustain demand, risks second-order inflation and higher inflation expectations," ANZ Chief Economist Sanjay Mathur and Asia Economist Krystal Tan said in a Wednesday note.

Gladstone Land Files $1 Billion Mixed Shelf

Gladstone Land (LAND) filed a shelf registration statement late Tuesday with the US Securities and Exchange Commission for the potential sale of up to $1 billion of securities from time to time in one or more series.The filing covers common and preferred stock, warrants, debt securities, depositary shares, subscription rights, and units.The company said it expects to use the net proceeds for general corporate purposes.

Equities Mixed Amid Uncertainty Around Trump's Iran Deadline

Wall Street's key equity benchmarks closed mixed Tuesday as uncertainty prevailed ahead of President Donald Trump's deadline for Iran to fully reopen the Strait of Hormuz.The Dow Jones Industrial Average fell 0.2% to 46,584.5. The Nasdaq Composite and the S&P 500 gained 0.1% each to settle at 22,017.9 and 6,616.9, respectively. Among sectors, communication services led the gainers, while consumer staples saw the steepest decline.West Texas Intermediate crude oil was last down 0.4% at $111.96 a barrel.Trump has set an 8 pm ET Tuesday deadline for Iran to agree to a ceasefire deal and fully reopen the Strait of Hormuz, a key trade chokepoint. Trump previously said a "whole civilization will die tonight" if there is no deal.Pakistani Prime Minister Shehbaz Sharif sought a two-week extension of Trump's deadline and urged Iran to temporarily open the Strait of Hormuz as "a goodwill gesture.""Diplomatic efforts for peaceful settlement of the ongoing war in the Middle East are progressing steadily, strongly and powerfully with the potential to lead to substantive results in near future," Sharif said in a social media post. "To allow diplomacy to run its course, I earnestly request President Trump to extend the deadline for two weeks."Only 15 ships were allowed by Iran to pass through the strait over a 24-hour period, about 90% below pre-conflict levels, according to an ING Bank report on Tuesday.The US previously hit military targets on Iran's Kharg Island, CNN reported, citing a US official, though oil facilities were spared.US Treasury yields were lower, with the 10-year rate last down 3.9 basis points at 4.31% and the two-year rate falling 5.4 basis points to 3.81%.In economic news, demand for US durable goods decreased more than estimated in February amid weakness in the aircraft component, government data showed."February's decline in durable goods orders reflected aircraft-driven swings rather than overall weakness," BMO Capital Markets said in a note. "Stripping out transportation suggests business investment will continue to support overall economic growth early this year."In company news, Apple (AAPL) shares fell 2.1%, among the worst performers on the Dow. The technology giant is facing issues in the engineering test phase of its foldable iPhone, potentially delaying the smartphone's production and shipment schedules, Nikkei Asia reported, citing unnamed sources.UnitedHealth Group (UNH) shares jumped 9.4%, the top gainer on the Dow and the second best performer on the S&P 500. Humana (HUM) surged 7.9%, while CVS Health (CVS) advanced 6.7%, both among the best S&P 500 performers. On Monday, the Centers for Medicare & Medicaid Services finalized 2027 Medicare Advantage payment rates above projections, Reuters reported.Broadcom (AVGO) shares advanced 6.2%, also among the top gainers on the S&P 500. On Monday, the chipmaker agreed to produce artificial intelligence chips for Alphabet's (GOOG, GOOGL) Google and expanded its collaboration with Amazon-backed (AMZN) AI startup Anthropic.Gold was last up 1.1% at $4,733.70 per troy ounce, while silver rose 0.3% to $73.08 per ounce.

Scorpio Tankers Plans $300 Million Convertible Notes Offering

Scorpio Tankers (STNG) said late Tuesday it plans to offer $300 million of convertible senior notes due 2031 in a private offering, with part of the proceeds to be used for share repurchase.The company said it expects to grant initial purchasers a 13-day option to buy up to an additional $45 million of notes.

Used Vehicle Wholesale Prices Reach Highest Since Summer 2023, Cox Report Shows

Wholesale prices of used vehicles in the US last month hit the highest point since summer 2023, led by electric vehicles, as demand remained robust despite the ongoing Middle East conflict, Cox Automotive said Tuesday.The Manheim used vehicle value index, or MUVVI, reached 215.3 in March, up 1.4% sequentially and 6.2% annually."As soon as this year began, prices at Manheim started moving higher as dealers anticipated strong demand from higher tax refunds to consumers," Cox Chief Economist Jeremy Robb said. "We thought we'd see some impact from the Middle East conflict, and that may still happen. But right now, the data is clear: used-vehicle demand is healthy and inventory levels are relatively tight."The ongoing US-Israel war with Iran, which started at the end of February, has curtailed shipments through the crucial Strait of Hormuz, sending energy prices surging.Used EV prices rose 7.9% annually and 3.7% from February, while the non-EV measure increased 6% and 1.8%, respectively, according to the Cox report."EV prices at wholesale are rising just as higher off-lease maturities for electric vehicles return to the market, pushing EV weighting to a record 3.9% in the MUVVI data for March," Robb said. "We expect dealers are anticipating increased interest for used EVs as gas prices have now risen above $4 per gallon and are stocking up on EV inventory."In terms of vehicle segments, the luxury component continues to outperform the overall market, while compact cars and trucks are still seeing "relatively weak" price growth on an annual basis, according to the report.For 2026, Cox maintained its outlook for used vehicle sales to drop 1% year over year. However, it upgraded its full-year retail sales estimate to 20.4 million units from 20.3 million."As we move towards summer, we expect Manheim values to hold their ground, with many more consumers yet to file their tax returns this year," Robb said. "The Middle East conflict could dampen the spirits of the US consumer, but we just haven't seen it yet -- our data is showing resiliency in the economy."

US Treasury Closing Levels

3:00 Tuesday vs 3:00 Monday2yr 100-02 vs 100-01+; 3.829% vs 3.848%5yr 100-18+ vs 99-16+; 3.971% vs 3.981%10yr 98-09+ vs 98-10+; 4.337% vs 4.333%30yr 97-12 vs 97-25+; 4.915% vs 4.889%2/10 50.551 bps vs 48.281 bps5/30 94.366 bps vs 90.566 bps

PepsiCo Likely to Post In-Line First-Quarter Results, BofA Says

PepsiCo's (PEP) fiscal first-quarter results are expected to be largely in line with Wall Street's estimates, with investors seen tracking progress on the North American food business' turnaround, BofA Securities said in a Tuesday note.The beverage and snacks giant is scheduled to release its quarterly results on April 16.BofA continues to expect PepsiCo's earnings per share at $1.53 for the quarter. Analysts in a FactSet poll are looking for EPS of $1.53 on a GAAP basis and $1.55 on an adjusted basis.Investors will focus on the progress on an affordability-led turnaround at PepsiCo Foods North America, BofA analyst Peter Galbo said. PepsiCo, which makes brands like Doritos, Lays and Cheetos, reduced the price of its snacks by up to 15% in February following customer feedback on the impact of rising costs.The company's North American food business likely benefitted from winter storm-related demand and early price cuts, the brokerage said.Also in focus will be the potential impact from the Middle East conflict and updates on growth initiatives at PepsiCo Beverages North America, or PBNA."At PBNA, retail sales and volumes remain largely unchanged on a sequential basis, with no clear signs of acceleration," Galbo wrote.Year-to-date, the brokerage is seeing mixed trends at the brand level, with core Pepsi underperforming the broader cola category and Mountain Dew showing signs of sequential improvement, Galbo said.BofA reiterated its neutral rating on PepsiCo's stock and a price target of $173.Price: $153.96, Change: $-2.77, Percent Change: -1.77%

National Bank Previews This Week's Labor Market Report in Canada

Canada's main macroeconomic event this week will be the release of the March Labour Force Survey (LFS), said National Bank of Canada.Canada will release the March LFS on Friday at 8:30 a.m. ET.After two significant declines in January and February, the bank expects employment to have rebounded slightly during the month, with an increase of 10,000 jobs.Despite this gain, the unemployment rate may have risen by one-tenth of a point, reaching 6.8%, stated National Bank. This is due to the fact that, after falling by no less than five-tenths of a point in the first two months of the year, the participation rate may have increased again, from 64.9% to 65.0%.

Equities Drop Intraday, Oil Rises as Trump's Iran Deadline Looms

US benchmark equity indexes were lower intraday, while oil prices moved higher as President Donald Trump's deadline for Iran to make a deal loomed.The Nasdaq Composite was down 0.5% at 21,883.5 after midday Tuesday, while the Dow Jones Industrial Average fell 0.4% to 46,485.5. The S&P 500 dropped 0.3% to 6,590.9. Among sectors, consumer staples saw the biggest decline, while communication services paced the gainers.West Texas Intermediate crude oil was up 1.5% at $114.06 a barrel intraday.Trump has set an 8 pm ET Tuesday deadline for Iran to agree to a ceasefire deal and reopen the Strait of Hormuz, a key trade chokepoint."A whole civilization will die tonight, never to be brought back again," Trump said in a social media post Tuesday. "Maybe something revolutionarily wonderful can happen, who knows."Trump's threat is a "sign of ignorance" that is unlikely to help potential dialogue, CNN reported, citing an interview given by Iranian government spokesperson Fatemeh Mohajerani to the official Islamic Republic News Agency.Although there has been progress in the last 24 hours in the US-Iran negotiations, striking a ceasefire deal by Trump's deadline seems unlikely, Axios reported, citing several sources.The US hit military targets on Iran's Kharg Island, CNN reported, citing a US official, though oil facilities were spared.US Treasury yields were higher intraday, with the 10-year rate up 1.8 basis points at 4.35% and the two-year rate rising one basis point to 3.86%.In economic news, demand for US durable goods decreased more than estimated in February amid weakness in the aircraft component, government data showed."February's decline in durable goods orders reflected aircraft-driven swings rather than overall weakness," BMO Capital Markets said in a note. "Stripping out transportation suggests business investment will continue to support overall economic growth early this year."In company news, Apple (AAPL) shares were down 2.8% intraday, among the worst performers on the Dow. The technology giant is facing issues in the engineering test phase of its foldable iPhone, potentially delaying the smartphone's production and shipment schedules, Nikkei Asia reported, citing unnamed sources.UnitedHealth Group (UNH) shares jumped nearly 11%, the top gainer on the S&P 500 and the Dow. Humana (HUM) surged 9%, while CVS Health (CVS) advanced 7.1%, both among the best S&P 500 performers. On Monday, the Centers for Medicare & Medicaid Services finalized 2027 Medicare Advantage payment rates above projections, Reuters reported.Broadcom (AVGO) shares were up 5.7% intraday Tuesday, among the top gainers on the S&P 500. On Monday, the chipmaker agreed to produce artificial intelligence chips for Alphabet's (GOOG, GOOGL) Google and expanded its collaboration with Amazon-backed (AMZN) AI startup Anthropic.Gold was up 0.4% at $4,701.90 per troy ounce, while silver fell 0.8% to $72.27 per ounce.

February Durable Goods Orders Fall More Than Expected Amid Aircraft Weakness

Demand for US durable goods decreased more than estimated in February amid weakness in the aircraft component, government data showed Tuesday.Orders for tangible items with an average life of at least three years fell 1.4% sequentially to $315.50 billion in February, following a 0.5% drop the month prior, the Census Bureau said. The consensus was for a 1.2% decline for February in a survey compiled by Bloomberg.Demand for transportation equipment fell 5.4% in February, following a 1.9% decrease in January. Civilian aircraft orders slumped roughly 29%, while the defense component logged a 3.8% drop. Motor vehicles and parts saw a 3.1% gain.Excluding transportation, durable goods orders rose 0.8% in February, higher than Wall Street's 0.5% growth view."February's decline in durable goods orders reflected aircraft-driven swings rather than overall weakness," BMO Capital Markets Senior Economist Priscilla Thiagamoorthy said in a note. "Stripping out transportation suggests business investment will continue to support overall economic growth early this year."Last month, planemaker Boeing (BA) reported that it received orders for 21 aircraft in February, up from 13 a year earlier, but down from 107 in January.Demand for primary metals, fabricated metal products, and machinery rose sequentially in February, while new orders for computers and electronic products were little changed, government data showed Tuesday.The ongoing US-Israel war with Iran, which started at the end of February, has curtailed shipments through the crucial Strait of Hormuz, sending energy prices soaring and stoking broad-based inflation concerns.Business equipment spending in the US was heading into the war with "plenty of momentum," Oxford Economics Lead Economist Bernard Yaros said in a remarks e-mailed toTuesday."The energy shock, along with the uncertainty created by the Iran war, is an emerging headwind," Yaros wrote. "However, the (artificial intelligence) buildout and the business tax cuts under the One Big Beautiful Bill Act will still allow equipment spending to grow this year, albeit a notch slower than earlier thought."Price: $208.86, Change: $-3.44, Percent Change: -1.62%

US 3-Year Auction High Yield Rises From Previous Month, Demand Higher

The US Treasury's 3-year auction hit a high yield of 3.897% on Tuesday, up from the 3.579% high in the previous auction.The bid to cover ratio for the auction was 2.68, above the 2.55 ratio in the previous auction.Dealers represented 55.50% of the bids, with direct bidders at 8.41% and indirect bidders at 36.09%.For takedown, dealers took 13.28%, with direct bidders at 11.91% and indirect bidders at 74.81%.

US 3-Year High Yield 3.897% vs 3.579% Previous; Bid/Cover 2.68 vs 2.55 Previous

SocGen's EU Governments Weekly Bond Positioning Report

The weekly analysis of flows into eurozone government bonds shows that for the week ended last Friday, investors were net buyers of Germany's Bunds and France's OATs, and, net sellers of Italy's BTPs and Spain's SPGBs, said Societe Generale.-- Bunds saw net buying over the week, continuing the trend from the previous six weeks and driven by both domestic and non-domestic investors. Domestic investors were net buyers, extending the buying momentum from the prior 10 weeks, with activity concentrated in the 5-10y and 10-20y sectors, where asset managers and insurers were the most active participants. Non-domestic investors were also net buyers for the seventh consecutive week, primarily in the 5-10y sector, led by hedge funds and insurers.-- OATs experienced net buying, continuing the trend observed over the previous six weeks and driven by both domestic and non-domestic investors. Domestic investors were net buyers for the 11 consecutive week, with activity concentrated in the 20y+ and 10-20y segments, led primarily by asset managers and insurers. Meanwhile, non-domestic investors were also net buyers for the seventh consecutive week, driven by hedge funds, with demand focused mainly in the 5-10y and 10-20y maturities.-- BTPs saw net selling, reversing the buying trend from the previous six weeks and driven by non-domestic investors. Domestic investors were net buyers, extending the buying trend of the past four weeks, with activity concentrated mainly in the 5-10y and 2-5y segments, led by banks. Non-domestic investors were net sellers, reversing the buying trend of the past 11 weeks, driven primarily by asset managers and hedge funds in the 20y+ and 10-20y segments.-- SPGBs saw net selling, reversing the buying trend from the previous four weeks and driven by non-domestic investors. Domestic investors were net buyers, extending the buying trend seen over the last four weeks, with activity concentrated in the 10-20y sector and driven primarily by banks and insurers. Non-domestic investors turned net sellers for the week, with activity focused mainly in the 10-20y and 2-5y categories and driven largely by banks and hedge funds.

Morgan Stanley Set to Gain Market Share Amid Intergenerational Wealth Transfer, UBS Says

Morgan Stanley's (MS) shares likely have several tailwinds lined up, including its ability to benefit from a $20 trillion intergenerational wealth transfer, UBS Securities said in a Tuesday note.Morgan Stanley Head of Wealth Management Jed Finn said at a UBS conference earlier this year that some $20 trillion of wealth is bound to move from baby boomers to Gen X and, eventually, to millennials, according to a FactSet transcript."We view the upcoming intergenerational wealth transfer as a pivotal money motion event -- one in which (Morgan Stanley) is poised to capture share and outperform peers," UBS analyst Erika Najarian wrote in the note. "At the core of our upgrade thesis is the view that operating leverage will increasingly materialize as asset growth compounds and productivity per advisor improves, aided by the technology investments the company has made."Morgan Stanley currently manages roughly $7.4 trillion in wealth-related assets, making it the largest wealth management bank with about 10% of market share, according to Najarian."We believe this leaves a big runway as wealth transfer accelerates," the UBS analyst said. (Morgan Stanley) has catapulted from partnering with 2.5 (million) households in 2018 to (more than 20 million) today, showcasing a potent engine for future growth."UBS upgraded its rating on Morgan Stanley's shares to buy from neutral and raised its price target to $196 from $195.The financial services firm could outperform in the investment banking and markets franchises too, Najarian said."The firm's (investment banking) stands to benefit from a strategic M&A super cycle and a re-acceleration in IPO activity," Najarian said. "Despite concerns over (artificial intelligence-driven) volatility in software stocks, (Morgan Stanley's) exposure is single digits of the pipeline."Recent structural enhancements to its markets business could help drive durable returns for the division, according to the UBS report."We think the market isn't appreciating how active capital markets accelerates net new asset growth, as liquidity events naturally flow into the advisory funnel," Najarian said. "Because of this, we think the bias to margins is to the upside."Price: $167.22, Change: $+0.67, Percent Change: +0.40%

Canada's Provincial Bonds Were Under Pressure in March, Says BMO

Canadian long provincial returns were under pressure over the past month alongside higher oil prices and a broad backup in bond yields, said Bank of Montreal (BMO).Spreads were relatively well behaved despite the risk-off sentiment stemming from the conflict in Iran, and provincials continue to outperform Government of Canada (GoC) bonds by a "solid" margin over the past six- and 12-month periods, the bank said in a Monday note.The geopolitical conflict and looming inflation impulse from higher oil prices has shifted market pricing on the Bank of Canada toward rate hikes later this year, although BMO still believes the bar for a hike is high given sluggish growth.Long spreads were mixed across the Canadian provinces over the past month, added the bank. Alberta outperformed on expectations that the recent budget, and its $9 billion deficit, will swing well into surplus in an environment of US$100/barrel oil prices.In the meantime, British Columbia continued to lag on deficit concerns and further credit rating downgrades, according to BMO. Most provinces have now tabled their FY26/27 budget.

Vancouver's Home Sales Stabilized at a Low Level in March, National Bank Says

Based on data from the Real Estate Board of Greater Vancouver (REBGV), National Bank of Canada's preliminary estimate is that seasonally adjusted home sales remained almost unchanged, or 0.1% lower, from February to March.This stabilization follows a slight rise of 3.2% in February after a drop of 10.7% in January.As a result, transactions continued to be very low on a historical basis and stood 30.2% below their historical average, noted the bank in a note last week.Resale market activity has not benefited so far from back-to-back rate cuts by the Bank of Canada in September and October, despite an improvement in the region's labor market, in contrast to a deterioration in the other two major Canadian cities since the beginning of the year, National Bank pointed out.It is likely that ongoing uncertainty surrounding trade relations with the United States, coupled with affordability challenges in the region, has continued to weigh on activity levels, added the bank.Should trade relations improve, the potential boost in consumer confidence could stimulate activity in the residential market, given the more favorable interest rate context, according to the bank.

Toronto's Housing Market Stabilizes in March After Seven Consecutive Declines, Says National Bank

According to the Toronto Regional Real Estate Board (TRREB) on Tuesday, seasonally adjusted home sales edged up 1.4% between February and March, the first increase in eight months, said National Bank of Canada.As a result, transaction levels in Toronto remain among the lowest since the COVID-19 pandemic and the 2008 financial crisis, noted the bank. In fact, sales were 40.8% below their historical average.The lack of momentum in the Toronto market is beginning to cause concern, especially since the Bank of Canada's interest rate cuts last fall failed to provide the spark the market had been hoping for to revive market activity, stated National Bank.There is no doubt that trade uncertainty with the United States continues to weigh heavily on Toronto's housing market, against a backdrop of ongoing affordability challenges, pointed out the bank.The slight increase in transactions in March is good news, but it is still too early to say for certain that this marks the beginning of a sustained upward trend, as tariff-related and now geopolitical uncertainty remains palpable, and the improvement in the labor market observed last fall in the region has partially reversed in recent months.On the supply side, new listings edged up 1.2% from February to March, following an 11.5% drop in February. Overall, National Bank estimates that active listings decreased by 3.5% during the month, marking the first decline in five months but remaining very high on a historical basis.Market conditions in Toronto, measured by the active listings-to-sales ratio, tightened in March for the first time in six months but continued to be among the loosest on record. Meanwhile, selling prices fell by 0.6% on a monthly basis, according to the MLS home price index.On a year-over-year basis, prices were down 7.2%.For Q1 2026, cumulative sales were down 7.2% compared with the same period in 2025, representing the slowest beginning of the year since 1995, added the bank.