The Week in Markets - Relentless move higher in treasury yield

The Beyond Markets podcast channel is wrapping up on a high note at the end of 2025. But do not worry! The conversation continues on our podcast Moving Markets by Julius Baer, where we'll be sharing fresh insights and analysis on current market developments.

Subscribe to Moving Markets on Spotify
Subscribe to Moving Markets on Apple Podcasts 

At 4.33%, the 10 year treasury yield is just 3 basis points below a new high since 2006. If the yield is the same 15 weeks from now, the treasury’s full-year return will be negative for 2023, for a third year in a row, something that has never happened before.

The oil price is up 35% since May, but hasn’t been accompanied by other commodity prices. We find when oil uptrends are not confirmed by the broader complex, they are not sustainable. 80% of Saudi’s production cuts are being offset by increases in other countries. Add to that a peak in oil demand in 2024 as the world transitions to electric vehicles, and we look for oil at $75 a year from now.

The S&P’s long-run seasonal average shows the best time to be in the market is the end of the year, and this year the S&P has had a remarkably close fit with the average so far this year. The consensus looks for a 0.2% y/y increase in Q3 earnings, but excluding energy, they could be up 5%. We think the current stock market consolidation will be over by mid-October at the latest, and then there should be a rally into year-end.