The yield on the 10-year US Treasury is approaching the 5.5% red line! Societe Generale warns: Stock valuation support is failing, US stocks may face a severe shock. - Bitget
EUR/USD — All Desk Targets
| Firm | Stance | YE 2026 |
|---|---|---|
BNP Paribas | Bearish | 1.1500 |
UBS | Bullish | 1.1800 |
UOB | Bullish | 1.1800 |
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The yield on the 10-year US Treasury is approaching the 5.5% red line! Societe Generale warns: Stock valuation support is failing, US stocks may face a severe shock. Bitget
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4 itemsRates Spark: Gimme five
The desk believes the U.S. 10-year Treasury yield, having just touched the 5% mark, is likely to test that resistance again, especially in the face of the upcoming Fed meeting. Per the full note from ing-think, the expectation is that a rate hike, which is anticipated by some, could either provide stability or further pressure yields beyond 5%. The commentary rightly notes that the yield dynamics are influenced by a blend of optimistically forecasted productivity, issuance concerns, and geopolitical risks, with the primary focus now being whether the market will journey toward 6%. With the Fed on the cusp of a potentially pivotal decision regarding another 25 basis point (bp) hike, market volatility could increase significantly, marking a crucial junction for the longer end of the curve.
US 10yr: Gunning for 5%. Eyes on 6%?
Lead — The desk anticipates the US 10-year yield will breach 5%, driven primarily by rising real yields amid fiscal and issuance concerns. Increased oil prices and inflation expectations compound this outlook, raising the specter of a potential surge to 6%. Per the full note from Padhraic Garvey, CFA, bond yields have already moved higher despite the Treasury Department's commitment to buy long-dated debt, indicating a clear market sentiment shift. This trajectory poses risks to the broader risk asset classes, particularly corporate credit, which currently enjoys a relatively calm environment but faces material stress from elevated real rates.
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