China Bond Traders Are Getting Bowled Over by Stock Bulls

China Bond Traders Are Getting Bowled Over by Stock Bulls

Chinese sovereign bonds are coming under pressure as growing optimism over local stocks drives the correlation between the two markets toward the most extreme levels since the pandemic.

The 90-day correlation between the CSI 300 Index and the Bloomberg China Treasury Total Return Index is heading toward its most negative level since 2020. The bond index is set for its biggest monthly loss since March, while the stock gauge has outperformed some global peers over the same period.

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