Bond Traders Eye Fedspeak for Sign of Doubt After Stocks Swings

Bond traders will look to key Federal Reserve speakers this week for any signs that officials are wavering from their plans to keep hiking rates gradually after U.S. stocks suffered their worst weekly sell-off since March. In the first quarter, the Fed looked past a tumble in the S&P 500 Index to tighten in March. Still, money-market traders have some doubts this time around, at one-point last week dialing back confidence in the prospect of three rate increases next year. For investors seeking fresh insight into the central bank’s thinking, Randal Quarles, the Fed’s vice chairman of supervision, may garner the most attention when he speaks on the economic outlook Thursday. The tumult in stocks, which pared their losses Friday, has helped reverse a surge in the benchmark 10-year Treasury yield to as high as 3.26 percent, a level last seen in 2011. Haven buying of longer maturities may also have factored into a resumption of the months-long trend of curve flattening, which regained momentum during the week as shares sank.