European Equities Under Increasing Pressure from Rising Rates
Dow Jones
Yesterday
1129 GMT - European stock valuations are under increasing pressure from higher bond yields, Bank of America analysts write. Rising yields on 10-year Treasurys typically translate into a de-rating in European equities, but stocks have been shielded so far by investors viewing stocks as less risky and the boom in corporate earnings. "However, over recent weeks the resilience of the equity market has started to show signs of strain," they say. The cooling earnings upgrade cycle, as well as a slight uptick in the risk premium that investors demand for holding European stocks, is putting pressure back on stocks. The Europe-wide Stoxx 600 rises 0.6% in early afternoon trade after losing close to 4% over the last month.
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