from Statista.com
— this post authored by Felix Richter
The cratering oil price sent markets into turmoil on Monday, as fears of an all-out oil price war and the ongoing coronavirus outbreak combined for a perfect storm of bad news. After stock markets from Germany to Japan had suffered steep sell-offs throughout the day, all three major indices in the U.S. tanked at the open, triggering a circuit breaker that halts trading for 15 minutes to keep stocks from falling through the floor.
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Already on red alert due to the coronavirus epidemic, investors turned to safe havens, pushing the price of gold to a seven-year high and squeezing the 10-year Treasury yield to new lows. As of 10:00 AM EDT, the yield for 10-year Treasury bonds stood at 0.49 percent, up from a historic intraday low of 0.32 percent.
As of this writing, the entire yield curve for U.S. Treasury bonds, i.e. yields for bonds with maturities ranging from 1 month to 30 years, is below 1 percent for the first time in history, indicating that investors are expecting the Fed to cut rates to zero in the coming months.
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