Bonds & Stocks
US Treasuries rallied while stocks cooled as traders awaited existing home sales and consumer confidence data. The yield on the US 10-year fell some five basis points, down more than 40 basis points already this month after data showing a slowdown in UK inflation.
Economy
Fears about companies struggling to pay their bills have dissipated as investors grow increasingly hopeful that central banks will start cutting rates next year. The extra yield over Treasuries that investors demand for buying US corporate bonds fell to around its lowest average level since January 2022, according to Bloomberg index spread data. Global junk bond yields are about the lowest since February.
World
More than a hundred container ships are taking the long route around Africa to avoid violence in the Red Sea, creating extra costs and delays, as the US weighs up how to respond to the latest threat to the global economy. According to logistics giant Kuehne+Nagel, 103 container vessels are rerouting from the Red Sea around Africa. Companies are also starting to look at using rail and air routes instead as the waterway that carries 12% of global trade is deemed too perilous to pass.