By all accounts, the pace at which the U.S. 10-year Treasury bond (IEF) is rising should create a steep stock market correction. Instead, traders flocked to the tried and true technology sector. The State Street Technology Select (XLK) ETF broke out, bouncing from support in the low $180s to $196.27 last week.
Rising bond yields sent the 20+ Year T-bill (TLT) down by 2.38% in the last week. TLT stock closed at $79.32, a new low.
Income investors cared about the alarming rise in bond yields. Realty Income (O) fell for around 30 straight business days. That streak ended when O stock gained 13 cents (0.23%) on September 25. The REIT now yields 5.87%.
W.P. Carey (WPC), VICI Properties (VICI), Simon Property (SPG), NNN REIT (NNN), and Agree Realty (ADC) all fell by between 0.61% and 2.74% in the last week. Still, SPG stock is up by over 10% YTD, compared to VICI, which is down 16.4%.
Telecom stocks traded lower in the last month. Charter Communications (CHTR) lost 27% in that time. T-Mobile (TMUS), AT&T (T), Verizon (VZ), and Comcast (CMCSA) are down. In Canada, Rogers Communications (RCI) dropped by 10.7%, slightly lower than BCE’s drop of 11.11% in the last month.
Your Takeaway
Bond yields might ease. Continue to watch out for its propensity to rise further, which would pressure the broader market.
