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Stocks Rebound as Treasury Yields Retreat

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Websim is the retail division of Intermonte, the primary intermediary of the Italian stock exchange for institutional investors. Leverage Shares often features in its speculative analysis based on macros/fundamentals. However, the information is published in Italian. To provide better information for our non-Italian investors, we bring to you a quick translation of the analysis they present to Italian retail investors. To ensure rapid delivery, text in the charts will not be translated. The views expressed here are of Websim. Leverage Shares in no way endorses these views. If you are unsure about the suitability of an investment, please seek financial advice. View the original at

The market endured a heavy sell off throughout August and September after the Fed signalled at its last meeting that another rate rise may be required this year in order to tame stubbornly elevated inflation – a prospect that subsequently triggered a surge in U.S. Treasury yields.

After a two-month sledding the U.S. benchmark index rebounded this week as policymakers at the Federal Reserve are becoming optimistic that the recent rise in Treasury yields could finally put an end to the historic interest rate hikes over the past 19 months.

Given the shift in tone in recent days from Fed members investors are also becoming increasingly hopeful that there won’t be further tightening of monetary policy. According to the CME FedWatch Tool the odds of another interest rate hike by the Fed in November are falling.

Financial markets currently see a nearly 90% chance the U.S. central bank will keep rates unchanged at its next policy meeting to be held on the 1 st of November. A month ago, those odds were at 57%. The majority of traders are betting that there will be no more hikes and that the Fed will hold rates steady through Q2 2024, before loosening policy.

A graph of stock market

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Source: TradingView, S&P 500 Index

The latest rally was driven in part by dovish statements from Federal Reserve officials, who said that the recent spike in U.S. Treasury yields to 16-year highs could lessen the need for the central bank to hike borrowing costs further in the short term. However, with the prospects of the U.S. falling into a mild recession in 2024, the index may face a choppy rise.

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Sandeep Rao

Research

Sandeep joined Leverage Shares in September 2020. He leads research on existing and new product lines, asset classes, and strategies, with special emphasis on analysis of recent events and developments.

Sandeep has longstanding experience with financial markets. Starting with a Chicago-based hedge fund as a financial engineer, his career has spanned a variety of domains and organizations over a course of 8 years – from Barclays Capital’s Prime Services Division to (most recently) Nasdaq’s Index Research Team.

Sandeep holds an M.S. in Finance as well as an MBA from Illinois Institute of Technology Chicago.

Julian Manoilov

Marketing Lead

Julian joined Leverage Shares in 2018 as part of the company’s primary expansion in Eastern Europe. He is responsible for web content and raising brand awareness.

Julian has been academically involved with economics, psychology, sociology, European politics & linguistics. He has experience in business development and marketing through business ventures of his own.

For Julian, Leverage Shares is an innovator in the field of finance & fintech, and he always looks forward with excitement to share the next big news with investors in the UK & Europe.

Violeta Todorova

Senior Research

Violeta joined Leverage Shares in September 2022. She is responsible for conducting technical analysis, macro and equity research, providing valuable insights to help shape investment strategies for clients.

Prior to joining LS, Violeta worked at several high-profile investment firms in Australia, such as Tollhurst and Morgans Financial where she spent the past 12 years of her career.

Violeta is a certified market technician from the Australian Technical Analysts Association and holds a Post Graduate Diploma of Applied Finance and Investment from Kaplan Professional (FINSIA), Australia, where she was a lecturer for a number of years.

Oktay Kavrak

Head of Communications and Strategy

Oktay joined Leverage Shares in late 2019. He is responsible for driving business growth by maintaining key relationships and developing sales activity across English-speaking markets.

He joined Leverage Shares from UniCredit, where he was a corporate relationship manager for multinationals. His previous experience is in corporate finance and fund administration at firms like IBM Bulgaria and DeGiro / FundShare.

Oktay holds a BA in Finance & Accounting and a post-graduate certificate in Entrepreneurship from Babson College. He is also a CFA charterholder.

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