Could Rising Rates Kill The Rally?

June 10, 2009 at 11:30 am  ·  Category: Interest Rates, Market Commentary

Is the rally over, killed by higher rates?  Not clear, but stocks are signaling that higher rates are going to be a major headwind.

“Stocks Signal Worries Over Higher Interest Rates”, Bob Pisani, Trader Talk, June 10 

tlt-ytd-chart

Note that big gap up on March 18.  That’s when the Fed said it would buy $300 billion in treasuries (“The Fed Must Be Crazy”, Top Gun FP, March 18, 2009).  Interesting how the market has sold off massively since that announcement.  Maybe the fundamental forces in play here are stronger than any manipulation by the Fed.

Disclosure: Top Gun is short long term treasuries via the ProShares UltraShort 20+ Year Treasury ETF (TBT).

Posted by Greg Feirman  ·  Trackback URL  ·  Link
 

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