Dow Industrials: Bonds and Tag-Along Advance

dow industrials: Right up until the election, the stock market had built in a status-quo rally, believing Hillary Clinton would win, according to Market Watch. The bond market reacted, too prices dropped and U.S. Treasury benchmark yields, which drive interest rates, climbed to their highest in a year on expectations for greater inflation and new debt issuance in a new administration. Just look at how repeated record highs for the Dow industrials and a tag-along advance by the S&P 500 followed a knee-jerk overnight plunge when Donald Trump election win first materialized. The gap between yields on higher-risk corporate bonds and lower-risk government bonds narrowed as investors scooped up riskier bonds for their higher payout. Read Fund managers see global inflation, fear protectionism after Trump victory So is the stock market or the bond market smarter when it comes to predicting what next for broader financial markets and the economy Will inflation sour the growth outlook, and which market will reflect that sooner Stocks and bonds have always been thought of as great indicators of future economic activity. But these relationships were already taking shape, in advance of the final election result. (news.financializer.com). As reported in the news.