The goldfish-like memory of investors was on show again yesterday as one piece of moderately good news, lower than expected weekly US jobless claims, led to a short-lived equity rally and a bond sell-off. Did the market forget this week’s dire housing and durable goods figures? Or the fact that this morning the most recent US GDP figures are almost certain to be revised sharply downwards? If so, its amnesia is unlikely to last.

The brief equity rally draws attention back to a four-month-old anomaly in the markets: the divergence between bond yields and equities. Since late April, the S&P 500 is down just over 5.5 per cent. The 10-year Treasury yield has fallen 35 per cent. In the UK, the FTSE 100 is down 10 per cent, while the 10-year gilt yield is down almost 30 per cent. There is no law that yields must trade in line with shares, but since the Russian crisis in 1998, they have generally done so as investors sell bonds to buy shares, and vice versa.

It could be that the relationship has broken down. Before 1998 the opposite relationship held, after all: falls in bond yields were good for shares. There are two better explanations, though.