January 23, 2018 / 4:06 PM / in 6 months

Investors most bullish U.S. longer-dated bonds since June -JPMorgan

    NEW YORK, Jan 23 (Reuters) - The share of investors holding
more longer-dated U.S. Treasuries than their benchmarks hit its
highest in almost seven months, reflecting the view that the
bond market selloff may be overdone, JPMorgan Chase & Co's
latest client survey showed on Tuesday.
    Benchmark 10-year Treasury yields hit a 3-1/2
year peak at 2.672 percent on Monday on hopes of domestic
inflation accelerating and speculation the Bank of Japan and
European Central Bank are preparing to reduce monetary stimulus
later this year.
    The share of investors who said on Monday they were "long"
longer-dated Treasuries rose to 19 percent from 17 percent the
previous week. The latest figure on longs was the highest since
June 26, JPMorgan said.
    The share of investors who said they were "short," or
holding fewer Treasuries than their portfolio benchmarks, rose
to 42 percent from 38 percent the prior week.
    The net shorts rose to 23 percent from 21 percent two weeks
earlier.
     Among active clients including market makers and hedge
funds, net shorts in longer-dated Treasuries grew to 60 percent
from 50 percent last week.
    At 10:34 a.m. (1534 GMT), the 10-year Treasury yield
 was 2.613 percent, down 5 basis points from late on
Monday.
    JPMorgan surveyed clients including bond fund managers,
central banks and sovereign wealth funds, as well as market
makers and hedge funds.
    The chart below displays the latest survey results of
JPMorgan's Treasury clients:

  All clients     Long   Neutral  Shorts     Net
                                           Position
 Jan. 2            19      39       42       -23
 Jan. 16           17      45       38       -21
 Jan. 8            15      43       42       -27
 Jan. 2            15      45       40       -25
 Active clients                                
 Jan. 22           10      20       70       -60
 Jan. 16           10      30       60       -50
 Jan. 8            20      10       70       -50
 Jan. 2            20      10       70       -50
 * NOTE: Positive value denotes net long, negative value denotes
net short

 (Reporting by Richard Leong; Editing by Meredith Mazzilli)
  
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