Wall Street stocks rose sharply on Wednesday, bouncing from a dramatic overnight sell-off, while the Mexican peso was battered as investors reacted to Donald Trump’s surprise win in the U.S. presidential election.
After sharp declines in U.S. stock futures overnight, equity investor panic eased but bond investors pushed up Treasury yields as they worried Trump’s policies would ultimately weaken the dollar and hike inflation.
U.S. long-dated Treasury yields rose to 10-month highs on Wednesday, bolstered by expectations that Trump will enforce protectionist trade policies that will weaken the dollar and boost inflation.
U.S. 30-year bond yields, which move inversely to prices, gained 22 basis points in their biggest jump since August 2011. Benchmark U.S. 10-year note yields climbed to their highest since January.