Long-dated Treasuries continue to outperform. Is omicron the thing that finally breaks this uptrend? A panicked trading reaction in the markets tends to lend itself to dollar strength and that’s exactly what we saw last week.

Tech is becoming the clear leader in the current market cycle. Industrials have struggled to participate in most periods of cyclical strength throughout the year. The rhetoric from several Fed members this past week calling for a more rapid taper was modestly bearish for inflation protection, but the uptrend here is far from broken.

Even though Treasury yields shot higher last week, they’ve been rising all along the curve. Above average inflation readings led to fresh interest in TIPS and a new leg higher in this ratio. Junk bonds have been in a persistent sideways pattern relative to the rest of the bond market for two months.