Stock Bulls Counting on Zero Rates Brush Off Rising Yields
- Fed seen keeping rates near zero to meet new inflation goals
- Negative real rates, higher curve are ‘perfection’ for stocks
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It’s going to take more than a quarter-point rise in bond yields to knock stock investors out of their euphoria.
That’s the message from the last 20 days in markets, where a steady rise in Treasury rates is doing nothing to derail another huge month for the S&P 500. While speculation has been rife that a back-up in yields is perhaps the only thing that could take a bite out of equity valuations, so far the increases haven’t been big enough for stock bulls to notice.