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What 5% treasury yields mean for investors: Strategist explains
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Treasury bond yields (^TNX, ^FVX, ^TYX) have been climbing higher, with markets widely concerned about the 10-year Treasury yield potentially exceeding 5%. RBC Capital Markets head of US equity strategy Lori Calvasina joins Market Domination to share her analysis. "It's sort of just a big round scary psychological number, but you do need to dig a little deeper," Calvasina explains, noting that if the 10-year Treasury yield breaks above 5%, "we're going to be breaking above some important highs that were put in place prior to the financial crisis." She points out that markets have primarily operated in a secular declining interest rate environment. However, rising yields would signal a shift toward a structurally rising rate environment. Regarding the relationship between earnings yield and PE yield, Calvasina observes that if this gap continues to widen "in a pretty significant way, it sort of hits people over the head with the idea that there is not a lot of value in the equity market relative to the bond market." Watch the full video above to hear Calvasina's in-depth views on how the PE multiples will impact equity markets.
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#stocks #youtube #news
About Yahoo Finance:
Yahoo Finance provides free stock ticker data, up-to-date news, portfolio management resources, comprehensive market data, advanced tools, and more information to help you manage your financial life.
- Follow Yahoo Finance on social:
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