Bond Yields Plunge on Cooling Inflation – Fed Cuts and Stock Rally in Play?
U.S. consumer inflation rose 3.0% year-on-year in September, slightly below forecasts, prompting markets to fully price in a Fed rate cut next week. The 10-year Treasury yield fell below 4% and the dollar weakened on the news. S&P 500 futures jumped about 1%, lifting stocks toward record highs. Financials outperformed, while homebuilders and utilities lagged.