Show Notes
With the US 10-year treasury yield recently crossing the 5% threshold and the Federal Reserve maintaining a hawkish stance, bond investors are facing heightened volatility and a rapidly shifting landscape. Are higher yields a warning sign of greater risk, or do they present new opportunities for portfolio construction? In this episode, Rishabh Saksena, Co-Head of Global Asset Class Specialists at Julius Baer, is joined by Dario Messi, Head of Fixed Income Research. Together, they dissect the drivers behind the recent surge in yields, the implications of monetary policy repricing, and the nuanced impact of a more hawkish Fed across the yield curve. The conversation covers duration preferences, the outlook for inflation and credit, the appeal of US investment-grade bonds, and the effects of increased bond issuance from sectors such as hyperscalers. This episode was recorded on September 28, 2026.
(00:00) - Introduction
(01:22) - What’s driving the move in yields?
(02:42) - Investor concerns and opportunities in fixed income
(03:45) - Why a hawkish Fed can support parts of the bond market
(05:26) - Outlook for the Fed and interest rates into 2027
(06:23) - Duration preferences and the case for intermediate maturities
(08:35) - Appetite for longer-dated bonds and portfolio construction trends
(10:07) - Implications of a sustained 5%+ US treasury yield
(11:48) - Inflation risks and expectations for 2027
(13:00) - Is corporate credit still attractive at current valuations?
(14:24) - Impact of increased bond issuance from hyperscalers
(15:48) - Key takeaways for fixed income investors
(16:53) - Closing remarks
(17:34) - Legal information
Would you like to support this show? Please leave us a review and star rating on Apple Podcasts, Spotify or wherever you get your podcasts.
More from Moving Markets
Meta Platforms sparked a broader sell-off across the semiconductor complex after reporting its first cash outflow in more than a decade. At the same time, government bonds rallied, pushing the 10-year US Treasury yield back below 5%. Meanwhile, pressure on French assets intensified, with the spread between French and German 10-year government bond yields widening towards 180 basis points. In today’s Moving Markets episode, Richard Tang, Head of Research in Hong Kong, joins us to discuss the outlook for Chinese equities after major indices slipped into bear-market territory.
On Wednesday equity markets across Europe rallied on the back of strong earnings announcements with even France’s CAC 40 gaining more than 1% on the day. Nervousness in French bonds markets continues though, with the 10-year government bond yield reaching 5% for the first time since 2002. The positive tone was echoed in the US where indices also closed higher and earnings again broadly satisfied. However, after the close the mood changed as Tesla’s earnings disappointed and geopolitical tensions saw Brent oil rise above USD 110 per barrel. Asian equity markets have sold off this morning with China’s CSI 300 heading into bear market territory. Norbert Rücker, Head of Economics and Next Generation Research, joins the podcast today for a timely look at why oil is trading at such unjustified levels, as well as sharing why he believes that the direction for both oil and gas prices should be down.
Oil volatility, a broadening equity rally and earnings dominated markets yesterday. While Netflix disappointed, SpaceX delivered standout results and Elon Musk floated the idea of a potential tie-up with Tesla. In Asia, stronger semiconductor sentiment and robust Japanese export growth supported risk appetite, offsetting weakness in CATL, China’s top battery maker, following its earnings release. Dario Messi, Head of Fixed Income Research, and Mathieu Racheter, Head of Equity Strategy, examine Europe as France's debt concerns deepen, European bank stocks central to Italy’s and Spain’s stock markets hit a four-month low, and Swiss large caps have been outperforming.
US technology stocks bounced back on Monday after last week's sharp sell-off, while political unrest in France weighed heavily on European markets, French bonds, and the euro. Oil prices swung on escalating geopolitical tensions in the Middle East, and investors continued to assess the implications of higher interest rates, AI investment spending, and upcoming earnings. In today's show, Enrico Chinello from Next Generation Research discusses last week's weakness in AI-related stocks, explains why we remain constructive on the long-term AI opportunity, and highlights the growing importance of cybersecurity.
The Nasdaq just posted its worst week since Liberation Day amid growing doubts over AI momentum. Capital rotated into bonds, with the US 10-year Treasury yield recording its biggest weekly decline since February, despite firm inflation data. Meanwhile, the ongoing earnings season looks set to test market sentiment. Mensur Pocinci, Head of Technical Analysis, explains why the medium- to long-term outlook for the technology sector is still positive, and what it would take for this to change.