Surging Yields Raise Threat of Tipping Point for Stocks

By Anonymous

Investors may start to pull back from riskier assets since they are being better compensated for holding risk-free ones

Yields on long-term U.S. government debt moved abruptly higher last week, calling into question the durability of the more than nine-year-old bull market for stocks.

A booming U.S. economy and investors’ desire to put their money in riskier assets, such as stocks and corporate bonds, have sent bond prices tumbling. That in turn has pushed the yield on the benchmark 10-year U.S. Treasury note, the backbone of borrowing costs for consumers, corporations and governments, to 3.23%.