Most investors say high rate looms as the biggest threat to stocks and risky assets, says BofA survey


Higher rates are starting to pick up on the mood of a surge in stocks and corporate bonds.

More than half of fund managers selected by BofA Global Research in January say the high interest rate and low funding policy have marked the biggest threat that could avoid driving bulls into risk assets in the first half of this year.

The rise in interest rates, Ralph Yuser said, “given the fiscal support that is being held in the United States about the tapes of Fed asset purchases, given the upcoming financial support in the US, investors risk Gives more information about. Strategist at BofA Global Research.

Perhaps not surprising, given the large role of Fedstop Reserve since last March, stemming from a huge drop in property values ​​that stemmed from apprehensions about the economic impact of the epidemic.

In January, long-term US government bond yields have gained ground following these concerns with the 10-year note rate TMUBMUSD10Y rising.
1.092%
Climbing more than 20 points since the beginning of the year. Their growth has threatened to raise borrowing costs for rate-sensitive corners of the economy and has increased the relative attractiveness of potentially risky assets.

So far, equities have mostly fallen short of modest increases in rates. S&P 500 SPX,
-0.40%
And the Dow Jones Industrial Average DJIA,
-0.27%
The month is still yielding modest gains, a period in which the equity benchmark is also touching fresh records.

See: Here is the market where the US Treasury yields for the next 10 years

Still, yields may be higher and yields are higher than the mere suggestion of a possible taping of asset purchases of former Fed Chairman Ben Bernanke, with fears of another “taper tantrum” to bolster the financial situation.

Atlanta Fed President Rafael Botik and some senior Fed officials stressed the possibility of the central bank easing the pace of asset purchases if the economy moves faster than expected this year.

But recent guidance from Fed Chairman Jerome Powell and other members of the Fed’s Board of Governors suggested that such negotiations took place ahead of time.

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