A nasty gale tore through the bond market the past month, sending yields flying, upending portfolios and whipping around valuation models.
With a tentative calm returning on Friday, it's probably time to assess the damage and look for any valuable windfall that was knocked loose.
Not every strong market reaction is an overreaction, and the swirl in stock and bond prices is almost entirely about an urgent repricing for an economic acceleration that appears quite likely. Yet when prices start to dart around as fast as they did last week, with 10-year Treasuries running briefly above 1.6% from 1.13% two weeks earlier, there's a better chance of overshoots.
Bonds themselves regrouped Friday, the 10-year settling all the way back to 1.41%, helped by a likely mechanical month-end rebalancing out of equities into fixed-income after stocks' massive outperformance this year.