Sovereign bonds surged, sending the Japanese benchmark 10-year yield below zero for the first time, as investors seeking the safest assets gorged on government debt. Treasury yields dropped to a one-year low and those on short-dated German securities dropped to records in the rush to refuge from a worldwide stock rout. Traders pared the odds the Federal Reserve will raise interest rates this year to 30 percent, before Chair Janet Yellen begins her two-day testimony to Congress on Wednesday. There is now $7 trillion of government debt with yields below zero globally, with the average yield on the Bank of America Merrill Lynch World Sovereign Bond Index at 1.29 percent, the least in data that go back to 2005. “It’s almost like a panic,” said Hideo Shimomura, the chief fund investor in Tokyo at Mitsubishi UFJ Kokusai Asset Management. “The flight to quality is exaggerated.” The benchmark 10-year Treasury […]