鈥楤ellwether bond鈥� down over COVID-variant concerns, 鈥榮ending strong signal,鈥� says local analyst
Nov 26, 2021, 1:59 PM | Updated: Nov 29, 2021, 11:16 am
(Photo by Spencer Platt/Getty Images)
(Photo by Spencer Platt/Getty Images)
Wall Street saw its Friday after investors reacted to news of a new COVID 鈥渧ariant of concern,鈥� which the World Health Organization has named the 鈥�omicron鈥� variant. The Dow Jones Industrial Average lost 905 points, or more than 2.5% of its value.
While many investors pay attention to the Dow, analyst Mike Alfstad of Seattle’s Alfstad Capital says he watches another benchmark, which has him concerned.
鈥淎s a bond guy, I watch the 10-Year Treasury yield, which is the bellwether bond around which everything else rotates, and upon which we rely a lot,” Alfstad told 成人X站 Radio. “When I see that indicator down over 10% in one day, that is really sending a strong signal.鈥�
He says it鈥檚 an indication some investors fear another slowdown in the economy.
鈥淏ut there鈥檚 a caveat,鈥� he continued. 鈥淭he trading desks are thinly populated on the day after Thanksgiving, so we can’t take too much away from a day like today.鈥�
Alfstad says Monday will be an important day for investors.
鈥淲hat the markets do after a day with big losses is either a validator, or it’s a discounter,鈥� he said.
He told 成人X站 Radio that he would not be surprised to see Monday 鈥渧alidate鈥� the Friday trading losses, which could send the markets into a deeper decline.
He thinks people with money in bonds and stocks need to pay close attention to their investments.
鈥淢y advice to everybody would be: In times of turmoil such as this, execute a modicum of caution, a bit more than normal,” he said. “Be prepared, not overwhelmed, if we slip back into a difficult economic moment for a while.鈥�
Alfstad says he encourages people to put money into savings and have as little personal debt as possible.
He says it appears the market is fearful of a new surge of COVID-19 with the omicron variant, and a further cooling of the world economy with supply chain disruptions and travel restrictions.
鈥淏ut we, as a nation, are capable of coming together and doing extraordinary things together if we believe in one another. So that would be my advice,” Alfstad said. “Let’s believe in one another.鈥�
