WS #15458
The 10-year Treasury yield has broken through to its highest level since 2002, a critical technical level that historically correlates with equity pressure. BofA's Mark Cabana warns that markets are starting to feel the bite of higher rates, suggesting the Fed may need to keep hikes on the table. This macro stress is transmitting globally, causing a resumption of the selloff in European banks like Deutsche Bank and Societe Generale, which tumbled more than 5% as bond yields rose. The inverse relationship between yields and stocks is currently dominating the market narrative.
Bond Yields and Macro Stress
The 10-year Treasury yield has broken through to its highest level since 2002, a critical technical level that historically correlates with equity pressure. BofA's Mark Cabana warns that markets are starting to feel the bite of higher rates, suggesting the Fed may need to keep hikes on the table. This macro stress is transmitting globally, causing a resumption of the selloff in European banks like Deutsche Bank and Societe Generale, which tumbled more than 5% as bond yields rose. The inverse relationship between yields and stocks is currently dominating the market narrative.