But as long as yields are a "natural byproduct of better economic activity" and moderate inflation, it shouldn't override the upbeat earnings companies have been reporting, he said.
The two-year Treasury yield, in the meantime, rose to as much as 2.50 percent for the first time since September 2008 amid bets the Federal Reserve would raise short-term rates further due to an improving USA economy.
Some investors were shrugging off the 10-year's milestone, preferring to watch the path of rates from here.
"(A strong) dollar makes gold expensive for non-U.S. buyers and rising yields increase the opportunity cost of holding gold, which is another factor lessening gold's appeal".
The European Central Bank is set to keep policy unchanged on Thursday, playing down worries over recent softness in the euro zone economy and leaving the door open to ending its lavish bond purchase scheme by the close of the year. Watch out when the 10-year yield will rise through 3 percent.
"4 - According to Seamus Mac Gorain from JPMorgan Asset Management, "[We] expect 10-year Treasuries to end the year between 3 and 3 ½ percent.
"Expectations towards USA rate hikes being gradual are enabling equities to take the current yield rise in stride".
US crude settled down 1.37 percent at $67.70 per barrel and Brent was last at $73.86, down 1.14 percent on the day.
This brings us to the crucial question and not withstanding that question has been side-stepped for a much too long time, is the United States a "positive rate economy" or not? Hong Kong's Hang Seng added almost 1.0 percent to 30,554.07, while the Shanghai Composite jumped 1.7 percent to 3,120.27, recouping losses from the previous day. Benchmark measures of emerging marketstocks and bonds from MSCI.MSCIEF and JPMorgan.JPMEPR, respectively, both closed at two-month lows.
US fundamentals remain very robust.
Facebook (FB), which reports earnings on Wednesday, fell 3.6 percent, to $159.89.
In my opinion, higher 10-year U.S. Treasury yields are completely on the cards.
Inflation fears related to rising oil prices have largely been held in check.
Spot gold was little changed at $1,323.34 per ounce at 0101 GMT.
Gold prices also came under downward pressure from an improvement in the geopolitical environment, with the U.S. Treasury Secretary cautiously optimistic on his negotiations with China, North Korea freezing its nuclear testing, and Washington extending its deadline for sanctions against Russia's Rusal, said OCBC analyst Barnabas Gan. However, a strong showing by the democrats today, especially if the turnout is relatively high, may influence expectations about what November's midterm elections may produce. This is an instance where politics does have some short-term market relevance because politics is interfering directly in the market.
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