Here’s my chart for today. I’ll talk about it shortly after 3:30 p.m. Eastern (12:30 p.m. Pacific) on the Bloomberg Businessweek radio show. Also, I’ll present my Stock of the Day just after 4:15 p.m. (1:15 p.m.) on social media. You can hear me on Bloomberg Radio or see me at Bloomberg Global News on YouTube.
Stocks are in a position to withstand higher bond yields, according to Keith Parker, UBS Group AG’s head of U.S. equity strategy. Comparing the S&P 500 Index’s forward price-earnings ratio with the inflation-adjusted or real yield on 10-year Treasury notes since 2017 shows as much, he wrote in a report last week. The forward P/E fell 1.2 points from mid-April through Tuesday to 21.3, according to data compiled by Bloomberg, while the 10-year real yield slid 0.1 point to minus 0.9%. “We see shifts in rates as less of a driver for equities,” Parker wrote, as long as they don’t happen suddenly.