The previous weeks, every time the 10Y treasury was making a new high it was major news.
Example from 18th January CNBC
” 10 year treasury yield hits 2 year high, hovers around 1.87%”
19th January
“The 10 year U.S. Treasury yield 1.9% on Wednesday its highest point since December 2019”
And obviously stock prices were falling those days. The explanation given by the analysts was that since the risk free return increased, investors avoid speculative companies and seek save heavens at bonds etc etc.
Today the treasury hit 2.37% and to my great surprise, there was no article mentioning this huge spike.
And markets keep going up. All unprofitable companies suddenly fly to moon. GME 10% up, Wish 7% up PTON 6% up etc etc
So how about the investors who seek safe assets in a rising interest environment, unprofitable companies that will find it difficult to find new funding now that bonds are high and all other excuses used to justify why stock prices were free falling when 10Y yield increased from 1.79 to 1.81 back in January?
Can someone help me understand the connection between these two because im really confused.
I thought I understood this basic principle in the economy “Interest rates rise = unprofitable stocks fall” but today's market is exactly the opposite
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