February 13, 2018 / 5:42 PM / 6 months ago

Investors most neutral on U.S. bonds since October -JPMorgan

    NEW YORK, Feb 13 (Reuters) - The share of investors holding
longer-dated U.S. Treasuries equal to their benchmarks rose to
its highest in about four months following last week's market
turmoil, JPMorgan Chase & Co's latest client survey showed on
Tuesday.
    Benchmark 10-year Treasury yields hit a
four-year high of 2.902 percent on Monday on concerns about
rising inflation and increased borrowing to fund more federal
spending.
    The 10-year yield swung in a 24 basis point trading range
last week, according to Reuters data, as global stock markets
were roiled by jitters over less stimulus from central banks and
technical selling spurred by a surge in volatility.
    Wall Street suffered its worst week in two years last week
with the benchmark S&P 500 index posting a 5.2 percent
drop, which was its biggest weekly percentage decline since
January 2016.
    The share of investors who said they were neutral on
longer-dated government debt was 51 percent, which was the
highest since Oct. 16, JPMorgan said.
    This compared with 47 percent who said they were neutral the
prior week.
    Meanwhile, the share of investors who said on Monday they
were "long" longer-dated Treasuries fell to 13 percent from 15
percent the previous week, JPMorgan said.
    The share of investors who said they were "short," or
holding fewer Treasuries than their portfolio benchmarks,
decreased to 36 percent from 38 percent. 
    The net shorts was unchanged on the week at 23 percent.
    Among active clients including market makers and hedge
funds, half of them said they were neutral on longer-dated
Treasuries, compared with 30 percent last week.
    At 12:26 p.m. (1726 GMT), the 10-year Treasury yield
 was 2.844 percent, down 1.1 basis points from late
on Monday.
    JPMorgan surveyed clients including bond fund managers,
central banks and sovereign wealth funds, as well as market
makers and hedge funds.
    The chart below displays the latest survey results of
JPMorgan's Treasury clients:

  All clients     Long   Neutral  Shorts     Net
                                           Position
 Feb. 12           13      51       36       -23
 Feb. 5            15      47       38       -23
 Jan. 29           13      49       38       -25
 Jan. 22           19      39       42       -23
 Active clients                                
 Feb. 12           0       50       50       -50
 Feb. 5            10      30       60       -50
 Jan. 29           10      30       60       -50
 Jan. 22           10      20       70       -60
 * NOTE: Positive value denotes net long, negative value denotes
net short

 (Reporting by Richard Leong; Editing by Andrew Hay)
  
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