JPMorgan advises taking profit on five-year Treasuries

JPMorgan advises taking profit on five-year Treasuries
Regional banks' fears and jobs data have fueled rise in notes.
FEB 02, 2024
By  Bloomberg

Investors should take profit on five-year Treasuries after the notes surged this week amid regional banking concern and data signaling the potential for a soft payrolls report on Friday, according to JPMorgan Chase & Co. analysts.

The bank recently recommended buying five-year Treasuries after yields jumped in January to a one-month high. With JPMorgan forecasting an upside surprise for January payrolls data on Friday, that makes it a good time for investors to sell the bonds now, analysts including Jay Barry, the firm’s co-head of US rates strategy, wrote in a report Thursday. 

“Combined with what we think is an overreaction to the regional bank developments as well as the risks around tomorrow’s employment report, these factors present upside risks to yields,” they wrote.

While the Federal Reserve held interest rates on Wednesday and pushed back against bets on a March cut, declines in US financial stocks led traders to become more certain that the central bank will soon have to pivot toward rapid easing. That sent Treasury yields back down to where they started the year. 

JPMorgan remains bullish on the longer-term outlook for medium-term Treasuries, and expects yields to go back up in the coming weeks, which will offer a more attractive time to go long again. 

Latest News

The 2025 InvestmentNews Awards Excellence Awardees revealed
The 2025 InvestmentNews Awards Excellence Awardees revealed

From outstanding individuals to innovative organizations, find out who made the final shortlist for top honors at the IN awards, now in its second year.

Top RIA Cresset warns of 'inevitable' recession amid tariff uncertainty
Top RIA Cresset warns of 'inevitable' recession amid tariff uncertainty

Cresset's Susie Cranston is expecting an economic recession, but says her $65 billion RIA sees "great opportunity" to keep investing in a down market.

Edward Jones joins the crowd to sell more alternative investments
Edward Jones joins the crowd to sell more alternative investments

“There’s a big pull to alternative investments right now because of volatility of the stock market,” Kevin Gannon, CEO of Robert A. Stanger & Co., said.

Record RIA M&A activity marks strong start to 2025
Record RIA M&A activity marks strong start to 2025

Sellers shift focus: It's not about succession anymore.

IB+ Data Hub offers strategic edge for U.S. wealth advisors and RIAs advising business clients
IB+ Data Hub offers strategic edge for U.S. wealth advisors and RIAs advising business clients

Platform being adopted by independent-minded advisors who see insurance as a core pillar of their business.

SPONSORED Compliance in real time: Technology's expanding role in RIA oversight

RIAs face rising regulatory pressure in 2025. Forward-looking firms are responding with embedded technology, not more paperwork.

SPONSORED Advisory firms confront crossroads amid historic wealth transfer

As inheritances are set to reshape client portfolios and next-gen heirs demand digital-first experiences, firms are retooling their wealth tech stacks and succession models in real time.