Decoding semiconductor volatility

Positive correlation between risk assets and government bonds breaks the roles these asset classes play within a portfolio. Here, we outline why correlations have risen, and how investors can seek to limit the impact on their portfolios.

Markets are navigating tensions between a Fed that offers less guidance and an inflation backdrop that remains sticky. Added uncertainty from Middle East tensions and energy-price swings is further shaping sentiment, with recent moves in Treasury yields suggesting the market wants the Fed to hike. However, with yield volatility expected to linger in the near term, we see today’s elevated Treasury yields as an especially compelling opportunity in fixed income.

Renewed hostilities in the Strait of Hormuz are once again threatening the energy flows the global economy depends on — and oil prices are already responding.

La ripresa delle ostilità nello Stretto di Hormuz torna a minacciare i flussi energetici da cui dipende l’economia globale, e il mercato petrolifero sta già reagendo. Il mercato dei future sul greggio sta tornando in backwardation: i contratti a breve scadenza valgono più di quelli a più lunga scadenza, segnalando tensioni immediate sull’offerta.