The world markets are still edgy after China’s currency devaluation last week, and a Fed report showing that New York area manufacturing started sliding downwards has not put any investors at ease.
Commodities and stocks both started down on Monday morning, many top analysts predict the pullback will continue for a short while longer as investors “feel out” what all the fallout from these big events will be. The fall in manufacturing is not especially unexpected, but as bad news piles up it makes investors start looking for safe havens for their money.
Traditionally, there have been two “havens” to go; bonds and gold. Gold, however, continues to decline along with many other commodities (especially oil) in a long-term downward trend. This leaves bonds, which have seen demand spike, and thus yields plummet, over the last few days as investors pour money in. It would not take much to have the market start swinging the other way, so pay close attention to the current market news to know where market sentiment is heading!
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