Excerpt from MarketWatch quoting DataTrek’s Nick Colas:
…. “Maybe forget about finding a crystal ball for stocks.
It’s “Finance 101 stuff” that Treasury yields need to stabilize before it’s possible for investors to gauge if U.S. equities have hit bottom, according to Nicholas Colas, co-founder of DataTrek Research.
Since Treasury yields provide the “bedrock of capital asset-pricing models,” without knowing if longer-term yields will settle anywhere from 2% or 5%, investors can’t know the cost of capital “that discounts corporate cash flows to create stock prices,” Colas said in a Monday client note”….
Read the full article here on MarketWatch!