BNP Paribas has a simple suggestion: buy the 10-year Treasury.
In a quick update Thursday morning, the firm sent around a trade recommendation telling clients to buy the 10-year Treasury, putting a target price of 1.40% on the trade.
The firm notes it was originally recommending the trade at 1.90% with a stop, or a price at which investors should take profits, of 1.60% but this has been extended to a target of 1.4%. BNP’s new stop is 1.65% and a re-entry would be recommended at 1.75%. Bond prices rise when yields fall.
This recommendation comes on a morning when stocks are selling off and the 10-year is pushing to a fresh year-to-date low of 1.528%, its lowest level since 2012.
As of 11:30 a.m. ET, the 10-year yield had backed up to around 1.56%.
The record-low yield for the 10-year was hit in July 2012 at 1.38%.
Other big movers on Thursday include the British pound falling against the dollar and gold rallying.