{"id":630467,"date":"2026-09-20T12:36:15","date_gmt":"2026-09-20T12:36:15","guid":{"rendered":"https:\/\/www.newsbeep.com\/ie\/630467\/"},"modified":"2026-09-20T12:36:15","modified_gmt":"2026-09-20T12:36:15","slug":"are-rising-bond-yields-bad-news-for-stock-investors-the-irish-times","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/ie\/630467\/","title":{"rendered":"Are rising bond yields bad news for stock investors? \u2013 The Irish Times"},"content":{"rendered":"<p class=\"c-paragraph paywall \">Rising borrowing rates \u2013 US 10-year bond yields have topped 5 per cent for the first time since 2007 \u2013 are bad news for governments, but are they also bad news for stock investors?<\/p>\n<p class=\"c-paragraph paywall \">Perhaps. A \u201cdisorderly rise in bond yields\u201d is the biggest tail risk facing markets, according to Bank of America\u2019s latest monthly fund manager survey.<\/p>\n<p class=\"c-paragraph paywall \">However, even without a \u201cdisorderly\u201d spike, today\u2019s yields give investors a more attractive alternative to stocks, making it harder for them to justify their risk.<\/p>\n<p class=\"c-paragraph paywall \">Already, the gap between equity earnings yields and bond yields is unusually narrow, notes Schroders. This does not necessarily mean poor near-term performance, but looking further out, a narrow gap has historically been associated with weaker long-term stock returns.<\/p>\n<p class=\"c-paragraph paywall \">The good news is strong earnings growth can provide a way out, as Schroders finds stocks have tended to defy a poor starting yield gap when real earnings growth is strong.<\/p>\n<p class=\"c-paragraph paywall \">And right now, analysts expect plenty of it, with US earnings forecast to grow 32 per cent in 2026, 16 per cent in 2027 and again in 2028, and with long-term growth rates \u201chigher even than in the dotcom era\u201d.<\/p>\n<p class=\"c-paragraph paywall \">If those numbers are remotely achievable, stocks can still comfortably beat bonds despite higher yields. If they are not, however, the attraction of a relatively risk-free 5 per cent becomes harder to ignore for investors.<\/p>\n","protected":false},"excerpt":{"rendered":"Rising borrowing rates \u2013 US 10-year bond yields have topped 5 per cent for the first time since&hellip;\n","protected":false},"author":2,"featured_media":630468,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5],"tags":[128,72,61,975,60],"class_list":["post-630467","post","type-post","status-publish","format-standard","has-post-thumbnail","category-business","tag-bonds","tag-business","tag-ie","tag-investment","tag-ireland"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/posts\/630467","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/comments?post=630467"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/posts\/630467\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/media\/630468"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/media?parent=630467"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/categories?post=630467"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/tags?post=630467"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}