U.S. Treasury yields are rising and may rise further. The U.S. 10-year Treasury yield exceeded 4.25% on Wednesday. That’s a nice round number that represents a resistance level that, if broken, could clear the way for further gains, said Mark Malek, head of investing at Siebert. In fact, he said, the benchmark yield may continue to climb to a high of 4.5%. The 10-year Treasury yield has recently hovered around 4.24%. “Certainly if we get above the 4.25% level, I would be concerned that there won’t be much support beyond that,” Malik said. Yields and prices move in opposite directions. 1 basis point equals 0.01%. US10Y 1D mountain U.S. 10-Year Treasury Bond Wall Street pointed to a mixed bag of culprits for the recent rise in yields, including strong economic data, worries that the Federal Reserve would cut interest rates less than previously expected and worries about the Federal Reserve’s deepening deficit. Yields are not high compared to historical levels. Nicholas Colas, co-founder of DataTrek Research, said that looking at data going back to 1962, the 10-year Treasury yield has averaged 5.8%. However, a rise in 10-year Treasury yields could put further pressure on stocks, with investors concerned that stocks are overvalued, particularly in housing. So far this week, the iShares US Home Construction ETF (ITB) and SPDR S&P Homebuilders ETF (XHB) are down 7% and 6%, respectively.
