Contrarian HSBC Bets on Stocks That Rise With Weaker Bond Yields

While equity investors left and right are scrambling to find ways of benefiting from rising U.S. government bond yields, HSBC strategists are looking to do the opposite.

The bank is recommending that European investors consider buying equities poised to benefit from falling bond yields, based on its view that the 10-year U.S. Treasury yield will peak around the end of the first quarter and weaken to 2.3 percent by year-end. It’s a view at odds with the one of Goldman Sachs Asset Management and large market speculators betting the 2018 bond-market rout will resume in the days ahead.