Demand for Higher Risk Assets Drives Equities and Energy Higher

Traders are looking for a higher opening in U.S. equity markets this morning based on a follow-through rally overnight.  Yesterday, equity markets fell sharply lower but were quickly bought up when crude oil reversed its intra-day trend and started to rally.  This move ignited renewed interest in higher risk assets.

Treasury markets finished lower yesterday and are called lower this morning.  This week’s auctions were well received but the turnaround in the stock market led to a sell-off signaling that traders are still looking for higher yields.  Demand for treasuries could drop today as more attractive yields in Japan could lead foreign investors to shop elsewhere for a better return on investment.

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