New Zealand 10-year bond yield slumps to near 2-month low despite burgeoning trade tensions; Q2 labour report in focus

New Zealand's government 10-year bond yield slumped to nearly 2-month low Friday despite burgeoning trade tensions ahead of the country’s employment report for the second quarter of this year, scheduled to be released by early next week.

At the time of closing, the yield on the benchmark 10-year note, which moves inversely to its price, slumped 4 basis points to 2.76 percent, the yield on the long-term 20-year note also plunged 4 basis points to 3.06 percent and the yield on short-term 2-year closed 1-1/2 basis points lower at 1.82 percent.

S&P500 slipped overnight, dragged down by tech shares (Facebook was the key laggard losing more than USD120 billion in market value), despite gains in media and telecom shares. After the market closed, Amazon reported better-than-expected Q2 earnings and guidance.

The trade deal between the EU and the US has left the question of whether a similarly positive development could be seen between the US and China. However, since Trump left the negotiating table at the end of May, there has been no sign of trade talks between the US and China. No trade deal between the two countries can be seen this side of the mid-term elections in November, Danske Bank reported.

Meanwhile, the NZX 50 index closed 0.71 percent higher at 8,996.16, while at 06:00GMT, the FxWirePro's Hourly NZD Strength Index remained slightly bearish at -84.26 (a reading above +75 indicates a bullish trend, while that below -75 a bearish trend). For more details, visit http://www.fxwirepro.com/currencyindex