Treasury ETFs Hit All-Time Highs in Stock Rout
May 30th 2012 at 9:57am by John Spence
Exchange traded funds indexed to U.S. Treasury bonds reached fresh all-time highs on Wednesday as the Dow shed more than 100 points on the worsening Eurozone debt crisis.
Yields on the 10-year note dropped to 1.65%, a new record low. Bond prices and yields move in opposite directions.
In bond ETFs, iShares Barclays 7-10 Year Treasury Bond Fund (NYSEArca: IEF) and iShares Barclays 20+ Year Treasury Bond Fund (NYSEArca: TLT) rallied to their highest levels ever. TLT rose 2% in early trading Wednesday. [Treasury Bond ETFs: How Much Lower Can Rates Fall?]
In currencies, the euro fell to a two-year low on concerns over Spain and the health of its banking sector. The iShares MSCI Spain (NYSEArca: EWP) slid 2.5%. The single-country ETF has dropped to its lowest level since 2003.
PowerShares US Dollar Index Bullish (NYSEArca: UUP) climbed to a 52-week high on Wednesday as investors moved into safe-haven currency and bond ETFs. The dollar ETF is on track for a gain of 5% in May and has only seen four losing sessions for the month. [Dollar ETF Rallies 5% in May Breakout]
iShares Barclays 20+ Year Treasury Bond Fund
The opinions and forecasts expressed herein are solely those of John Spence, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.