Sevens Report: 10-Year Yield Remains ‘Neutral’ for Stocks
Tom Essaye says the 4.20% range keeps markets stable — for now.
10-Treasury yield rises, but remains in range seen as ‘neutral’ for stocks
Treasury yields were rising Monday morning, with the rate on the 10-year note reversing its decline from last week but still trading in a range that Sevens Report Research called “neutral” for the stock market.
“The 10-year Treasury yield has been well behaved through this recent stock market volatility and in the 4.20% range it remains neutral for markets generally speaking,” Tom Essaye, founder and president of Sevens Report Research, wrote in a note Monday. “That needs to continue, because a sudden plunge below 4.00% would signal growth concerns, while a jump above 4.50% would imply rising inflation risks and both would add incremental headwinds on stocks (and possibly bonds).”
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