Economist's Insights

Today’s Trading Activity – Stocks Rebounded as Syria Strike Appeared Less Imminent

Apr 12, 2018

Treasury yields moved up as equities leapt the at the open after the President walked back his previous day’s indication that a missile attack on Syria was a coming certainty. A subsequent boost, albeit a small one, occurred on a headline that the President was considering rejoining the Trans-Pacific Partnership. Those firmer trends were briefly disrupted by news that samples from Syrian victims confirmed a chemical weapons attack and a report that the U.S. was considering a strike against eight targets in the country. But the downturn proved brief and both yields and stocks bounced back, ignoring a headline that Saudi Arabia had intercepted another missile. For the day, the 2-year yield rose 4.1 bps, its biggest single day increase since February 1, to a new cycle-high of 2.35%. The 5-year yield rose 5.8 bps, the largest daily increase since February 14, to 2.67%. The 10-year yield closed 5.5 bps higher, its biggest move since March 2, at 2.84%. The Dow outperformed with a 1.2% improvement and financial companies led the S&P to a 0.8% gain.