Five-year inflation expectations as measured by yields on U.S. government securities rose above 2 percent for the first time in seven months after a report showed the economy added more jobs than forecast in February.
McKesson Corp. and Gilead Sciences Inc. led the second-busiest week on record for U.S. bond sales as borrowers locked in the lowest relative yields in about seven years with markets stabilizing following turmoil in Ukraine.
China’s onshore bond market experienced its first default as a solar-cell maker failed to pay full interest on its bonds, signaling the government will back off its practice of bailing out companies with bad debt.
Investors are pulling money out of exchange-traded funds that buy bonds in the U.S., with the biggest outflows from government securities as they shift into stocks, signaling a willingness to delve into riskier assets.
Emerging-market stocks rose a second day as the European Union promised emergency aid to Ukraine while U.S. and Russian diplomats held talks. The Standard & Poor’s 500 Index held near a record while oil declined.
Spain’s bond yields dropped to an eight-year low and Italian and Greek government securities rallied as evidence mounted the euro-area economy is improving before the European Central Bank meets tomorrow.