Analysis-Soaring Treasury yields threaten long-term performance of US stocks
Soaring U.S. Treasury yields are further boosting the appeal of bonds over stocks, deepening an already painful equity selloff while threatening to weigh on equity performance over the long term. Bond yields near historic lows bolstered the attractiveness of stocks over the past 15 years, when the U.S. Federal Reserve kept rates near zero to support the economy following the 2008 financial crisis. This year’s climb in Treasury yields is changing that calculus, as government bonds offer income that is viewed as risk-free to investors who hold them to term.