But as Treasury yields have risen, their implied volatility -- as judged by Bank of America’s MOVE Index -- has remained subdued.
Utilities, an interest rate sensitive sector, haven’t even registered large underperformance amid a roughly 25 basis point rise in the 10-year Treasury yield. This may be a sign that equity investors doubt the increase in risk-free rates will persist.
"Where we are today, is in a period of relative calm as U.S. bond yields probe their highs, and we become accustomed to trade rhetoric and perhaps, blasé about the economic damage it will cause," writes Societe Generale SA’s global strategist Kit Juckes.
This article provided by Bloomberg News.