Bonds

Traders are bracing for a range of Fed outcomes: some hedging flows have favored outlier dovish scenarios and other trades have focused on the possibility that the Fed forgoes a move at one meeting.

Treasuries tumbled after a stronger-than-expected jobs report for June prompted traders to exit bets on an interest-rate cut by the Federal Reserve this month.

The US bond market is starting to get some relief, with long-maturity yields falling on Wednesday after Trump indicated a willingness to strike a trade deal with China.

Moody's Corp., a company that grades bonds and analyzes corporations' financial performance, said it expects to earn less this year than it had previously forecast.

In a sign of how Treasuries' status as a global haven during times of turmoil may be fading, rates on longer-term debt soared last week as equities convulsed, turbocharging bets on a steeper yield curve.

The advances pushed the yield on three- to 10-year yields lower by 10 basis points on Monday, with the moves accelerating as US equities sold off.

The overall price drop was offset by interest payments, allowing a broad gauge of the Treasury market to post a gain of about 0.7% this year through Dec. 30.

Sales of bonds earmarked for supplemental coverage of large windstorms, earthquakes and other events totaled $17.7 billion, up 7% from the previous record set a year ago.

Investors have wildly different takes on whether the Fed's three-month-old easing cycle — designed to bring the benchmark rate back down to neutral as inflation cools — is just beginning or getting close to the end.

Tuesday's declines lifted yields by one to four basis points across maturities after Trump said he'd impose additional 10% tariffs on goods from China and 25% tariffs on all products from Mexico and Canada.