Yardeni Says Bull Market Can Withstand Bond Selloff, Warns on 10-Year Yield Above 5%
Summary
- Yardeni Research said the stock market bull market is not under threat despite rising U.S. Treasury yields and a bond selloff.
- Yardeni Research said the recent jump in U.S. Treasury yields reflects improving economic strength and could offer a buying opportunity during a market correction.
- Yardeni Research maintained its S&P 500 target of 8,250 and said it could shift to a more cautious stance if the 10-year Treasury yield rises above 5%%.
Forecast Trend Report by Period
Rising U.S. Treasury yields are unlikely to threaten the stock market's bull run, according to Yardeni Research.
Walter Bloomberg reported on May 20 that Yardeni said in a note that the climb in Treasury yields and the related bond selloff are not enough to derail the equity rally. Any pullback in stocks could instead offer a buying opportunity, the firm wrote.
Yardeni said the recent surge in Treasury yields reflects improving economic strength rather than systemic risk. It described the current backdrop as "a resilient economy facing a short-term inflation problem, not stagflation."
The 30-year Treasury yield recently rose to 5.19%, while the 10-year yield climbed to 4.69%. Strong U.S. economic data and hotter-than-expected inflation readings helped push yields higher.
Yardeni maintained its S&P 500 target at 8,250. Still, it said it could turn more cautious if the 10-year Treasury yield rises above 5%.
