Bonds beat stocks worldwide in past month on demand for safety

SINGAPORE, Aug 17 (Bloomberg): Bonds trounced stocks worldwide over the past month as investors sought the safety of debt amid unrest in Ukraine and the Middle East and signs of uneven economic growth.

The Bank of America Merrill Lynch Global Broad Market Index returned 0.9 per cent in the month ended yesterday. The MSCI All-Country World Index of shares lost 1.3 per cent after accounting for reinvested dividends. Ten-year Treasuries, the benchmark for global borrowing costs, headed for a second weekly gain.

"People want to put their money in a safe haven," said Yoshiyuki Suzuki, the head of fixed income in Tokyo at Fukoku Mutual Life Insurance Co., which manages the equivalent of $58.6 billion.

US 10-year yields were little changed at 2.41 per cent at 10:06 a.m. in Tokyo, according to Bloomberg Bond Trader data. The price of the 2.375 per cent note due in August 2024 was 99 22/32.

Ten-year yields have fallen eight basis points over two weeks. A basis point is 0.01 per centage point.

The yield will end 2014 at 2.92 per cent, according to the median forecast of economists surveyed by Bloomberg Aug. 8-13 and published yesterday. The estimate was 3.44 per cent in January.