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Chart In Focus

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October 21, 2026

Treasury-Bund Spread Rising Is Bullish

A year ago I noted here that there was a divergence in effect between stock prices and the Treasury-Bund spread.  That divergence has since been rehabilitated, and the spread is now rising which is a bullish condition. The Treasury-Bund spread I am referring to is the difference between the current 10-year yield on US T-Notes versus the equivalent 10-year German sovereign debt instrument.  Ever since German reunification in October 1990, there has been a very strong correlation between this yield spread and the behavior of US stock prices.  Interestingly, this relationship did not work before that reunification. More important than their… more

 

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