Bonds Calling the Shots for Stocks as Rate Cuts Outweigh Trade

  • Markets are pounding the table for a Federal Reserve rate cut
  • Lower interest rates are a base for the stock bull case

Photographer: Julia Schmalz/Bloomberg

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For investors who see this year’s stock rally balanced on the twin pillars of easy money and peace in the U.S.-China tariff war, well, at least one’s still standing. For the last three days, that’s been enough.

The worst stretch since Christmas, sparked by the crumbling trade truce, has been followed by the second-best run this year as traders priced in diminished rate expectations. Will it last? Who knows. But with Twitter quiet and the 10-year yield hovering at 2.4%, it hasn’t taken long to put last week’s battered bulls back on the scent of a melt-up.