The wild breakout in German yields is rocking global debt markets, and giving investors an early glimpse of the uneasy future for bonds in a world of higher interest rates.
The shakeout also carries a message for corporate bond investors, who have snapped up a record level of new issuance this year, and are now seeing negative total returns in the secondary market for the first time this year.
As German bund yields zip higher, they are pulling European sovereigns and U.S. Treasury yields higher with them. The 10-year Treasury yield jumped Wednesday to 2.38 percent, the highest since November. The 10-year bund, at 0.71 percent just Tuesday, shot higher and neared 0.9 percent.
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