Halftime Report Will Rising Rates Wreck Stocks? 5/22/25
May 22, 2025
Josh Brown, a CNBC market commentator known for his sharp insights, joins fellow commentator Jim Labenthal to dig into the potential impact of rising interest rates on stocks. They discuss the resilience of the U.S. economy, consumer confidence, and shifting investor priorities. The duo also touches on tech trends like OpenAI's acquisition and reviews key stocks like Snowflake and UnitedHealth, highlighting both growth opportunities and market caution amid evolving economic conditions.
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Bond Yields Reflect Mixed Signals
- Bond yields have surged recently, reflecting concerns about deficits and economic growth.
- Despite higher yields, disinflationary forces like slowing economy and AI impact suggest rate cuts ahead, implying a potential head fake in rising long yields.
5% Yield as Market Tipping Point
- When 10-year Treasury yields approach 5%, their attractiveness to investors rises, potentially hindering continued earnings growth.
- Rising rates driven by fiscal concerns differ from those due to economic shifts, impacting investor behavior uniquely.
Rates Hurt Speculation, Not Market
- Rising rates don't necessarily wreck the broad market but impact speculative and leveraged areas more.
- Speculative segments like recent IPOs and SPACs suffer more as capital cost increases, acting as a governor on valuation multiples.