Emerging Markets Total Return Index (Equities Relative to Bonds) and OECD Core CPI (Leading Indicator) Emerging markets equities relative to bonds tend to lead OECD core CPI by 40 weeks. Image: BCA Research
U.S. 10-Year Bond Yields Around Bear Markets Low and anchored bond yields during the recovery help to explain the strong rise in equity valuations. Image: Goldman Sachs Global Investment Research
Great Bond Bear Markets in U.S. History Worried about a bond bear market? Image: BofA Research Investment Committee
Secular Bull Market – Dow Jones Industrial Average and 30-Year Bond Cycles Chart suggesting a “new” secular bull market underway with the potential to last until 2034. Image: Fundstrat Global Advisors, LLC
Corporate Bonds – Share of Market Value in Bloomberg Barclays USD IG (AAA, AA, A, BBB) Credit quality is deteriorating, as the amount of BBB-rated bonds, one step away from junk bonds, has doubled since 1990. Image: Deutsche Bank Global Research
Bond Yields, U.S. Dollar and Stock Market According to BofA, the biggest summer pain trade would be a rise in bond yields, a falling U.S. dollar and a sideways stock market. Image: BofA Global Investment Strategy
Flows – IG Bond Funds/ETFs and Prime Money Market Funds From record outflows to large inflows, the Fed has solved the liquidity crisis so far. Image: BofA Global Research
Fund Flows – Equity, Bonds and Money Market Funds Investors frightened by the coronavirus pandemic, put a record amount of cash into money market funds. Image: Goldman Sachs Global Investment Research
Corporate Bonds: IG Downgrade to HY and BBB Share of U.S. IG Market This chart highlights the resilience of BBB-rated bonds. BofA believes that there is little risk that IG ratings will fall to junk status in the next recession. Image: BofA Global Research
Bull Market – U.S. Stocks-to-Bonds Ratio Chart showing the bull market in the U.S. stocks-to-bonds ratio. So far, the long-term support has held well. Image: BCA Research
Fund Flows into Emerging Markets Stocks and Bonds The rotation into bonds and out of equities continues. Image: HSBC