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The Bond Market May Be Telling The Fed Something
The 10-Year Treasury yield has surged 85% since the beginning of the year. This benchmark yield broke through pre-pandemic levels today, illustrating increased optimism about economic recovery.
The Federal Reserve has maintained its extremely dovish stance about keeping short-term rates at the current record lows. The markets are telegraphing to Jerome Powell that his dovish narrative needs to be shifted.
The markets are pricing in a potential taper tantrum. The Fed’s first move towards a more hawkish narrative would be to announce a decrease in its balance sheet value (aka taper tantrum).
The implications of this yield move are positive for value stocks but deflating some of the most stretched tech valuations.
+1,500% Growth: One of 2021’s Most Exciting Investment Opportunities
In addition to the stocks you read about above, would you like to see Zacks’ top picks to capitalize on the Internet of Things (IoT)? It is one of the fastest-growing technologies in history, with an estimated 77 billion devices to be connected by 2025. That works out to 127 new devices per second.
Zacks has released a special report to help you capitalize on the Internet of Things’s exponential growth. It reveals 4 under-the-radar stocks that could be some of the most profitable holdings in your portfolio in 2021 and beyond.
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