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Rising bond yields leave markets more vulnerable to bad news
Strategist Albert Edwards of Société Générale said surging yields can heighten the impact of negative developments, even if they are not sufficient by themselves to trigger a market disruption.
MarketWatch reports that bond yields rising rapidly are making investors more vulnerable to unexpected negative news in financial markets.
In a separate note on the outlook, the outlet points to Albert Edwards of Société Générale, who described himself as a pessimistic strategist while arguing that surging yields alone would not necessarily be the trigger for a major “accident.”
Still, MarketWatch says the move in yields can raise the odds that markets react sharply if other bad information hits, because borrowing costs and discount rates matter for valuations and risk appetite.