Rising bond yields may pressure equity markets
Wolfe Research has adopted a more cautious stance toward risk assets due to the growing disconnect between climbing bond yields and resilient equity markets.
The firm has revised its Federal Reserve outlook, now expecting all anticipated interest rate cuts to be delayed until the second half of 2027.
Three possible paths to lower yields include weaker-than-expected economic growth, a broader equity market decline, or a de-escalation of the conflict with Iran.