¿Pueden los altos rendimientos de los bonos hacer caer las acciones?

The recent surge in oil prices to over $100 per barrel, unprecedented since July, triggered an increase in Treasury bond yields following Scott Bessent's announcement to repurchase $6 billion of Treasury bonds. The secretary of the U.S. Treasury's assertion that he governs Japan may have been insufficient to prevent the yield rise, especially in Japan where the yen appreciated following U.S. and Japanese interventions.

Higher yields lead to falling stock prices, as evidenced by the 10-year Treasury bond yield at 4.85% nearing its 2023 peak and the symbolic 5% level. Analysts wonder when bond returns will plummet in the stock market.

Michel Lerner of UBS Holt believes that speculation with bonds is rarely controllable due to the inability to curb deficits without weakening growth or fueling inflation. Highly indebted economies, particularly U.S. stocks, are especially vulnerable to contagion. Financial Times' Ruchir Sharma stated that throughout the last 300 years, all major bubbles ended only when borrowing costs significantly increased for the companies they spurred.

The key indicator is the yield on U.S. 10-year Treasury bonds, which should exceed 5% to signal the end of bubbles. Freya Beamish and Davide Oneglia of TS Lombard argue that the U.S. 10-year Treasury yield should be at least 5% to offset the bull market in technology and potential bubble in AI. The risk premium in the U.S. remains too low to compensate for the loss of equity coverage.

Ultimately, these factors must return to normalcy, and a sustainable increase in risk premiums for U.S. equities is unlikely.

Several mechanisms may explain how high yields cause stock prices to fall: 1) higher interest rates slow the economy by increasing financing costs for cyclical sectors, reducing corporate profits and stock prices; 2) higher interest rates lower the present value of future cash flows from companies, decreasing stock values; 3) higher interest rates divert capital flows away from equities towards more attractive future returns; 4) higher interest rates force governments to cut deficits, which, like most times, leads to reduced corporate profits.

Each possibility is analyzed separately, with the first focusing on the housing sector, the second on the capital valuation calculation, the third on capital flows, and the fourth on government spending reductions.