Want to Know When Interest Rates Might Spike Again? Watch AAPL.
by Editorial Staff
Updated: May 24, 2023
Good day, bonjour, ni hao. It's Murray Gunn from Elliott Wave International here.
Let me take a minute of your time to show you a fascinating chart which could be well worth noting.
Whenever apple has issued corporate bonds (that is, borrowed money) it has tended to presage a general rise in yields (or borrowing costs).
In April 2013, when apple came to the bond market for the first time in twenty years, the yield on an index of aaa-rated corporate debt had declined from close to 8% in 2009 to less than 2%. Over the course of the next five years the yield then rose steadily to nearly 4%.
In 2019 and 2021, apple's borrowings also coincided with low points in yields.
We showed this chart in august last year, the last time Apple issued bonds and stated, "we might expect a general rise in yields." As if by magic, the yield on the AAA-rated corporate bond index then surged from 3.5% to 5% over the next three months.
This month, Apple borrowed from the bond market again. If the iconic tech company's track record is anything to go by, brace yourself for a coming rise in bond yields.
This is also consistent with our bearish Elliott wave analysis on the bond markets.
For more cool charts like this, stay tuned to elliottwave.com and check out our Interest Rate ProServices.
Until the next time...ciao.
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