Bank of America was up nearly 3% at 1 pm as banks surged in Tuesday trading. US Treasury securities are getting bashed by the falling dollar, with the 10-year note rising just behind the falling euro. Oil is up a bit, helped by the falling dollar as well. That’s good for energy companies.

On the S&P 100, the worst performer is Verizon, down 2% on the prospect of a deal between Sprint and Comcast. The major equity market indices are almost unchanged.

It’s a bit unsettling that Treasury yields have jumped on a day when the International Monetary Fund downgraded its US growth forecast, and a day after disappointing durable goods numbers and an unexpectedly negative Chicago Activity Index report. As the intraday chart shows, Treasury yields followed the bouncing Euro–probably because foreign investors are lightening up on Treasuries in anticipation of future dollar weakness.

The inevitability of European Central Bank tightening at some point in the next 12 months means that at a year’s horizon, the euro is as close to a one-way bet that can be found in the foreign exchange market. As long as the rise in Treasury yields is gradual and limited, it won’t have much impact on economic activity. And if oil rises back above the $50 level, it will help both CapEx and the oil-sensitive high yield sector of the bond market. High yield corporate bond yields tightened vs. Treasuries slightly, driven mainly by the energy sector.