Markets Grind Higher
Despite generally lackluster earnings, the S&P 500 index rose more than 1.7% during this past week and closed at an all-time high. The upside move in domestic equities comes on the heels of rising global sovereign bond rates. Most notably, the sell-off in the 10yr German Bund caused the yield to more than double, from under 0.07% earlier in the week to 0.15% presently. This move in sovereign rates may prove significant in the deflation fight taking place in the EU and signal that pro-growth policies, coupled with European Central Bank action, are beginning to spur economic expansion in Europe.