Yield Shockwaves: Wall St and Asian Shares Bleed as Bond Sell-Off Goes Global

We see a breaking point now with the bleeding in the bond market. When the U.S. 10-year Treasury yield is rockets toward 4.8% and Japanese JGBs are spiking past 3% to hit multi-decade highs, the stock valuations changes because the risk-free rate is just too high to ignore. Growth stocks and high-multiple tech companies are getting hit the hardest right now because their future earnings are worth way less when discounted against these surging yields. On top of that, you have crude oil pushing past $90 a barrel because of the chaos keeping shipping lanes closed in the Middle East, which means companies are facing a dual threat of shrinking profit margins and sticky inflation. Throw in psychological damage of the U.S. national debt crossing $40 trillion, and institutional money is clearly dumping risk assets globally to scramble into short-term cash and T-bills.

Source: ABC News