JPMorgan warns rising bond yields threaten global equities in September

The bond market is flashing warning signs, and JPMorgan wants equity investors to pay attention. Grace Peters, co-head of global investment strategy at JPMorgan Private Bank, told Bloomberg Television that bond yields climbing into the 5% to 5.25% range pose a meaningful risk to stock valuations heading into what is historically one of the roughest months for fixed-income markets. Her warning lands at a moment when yields across the globe are surging to levels that haven’t been seen in years, or in some cases, decades. The US 10-year Treasury yield has climbed to roughly 4.8%, its highest mark in nearly three years, while Japan’s 10-year government bond yield has blown past 3% for the first time since 1996. UK 30-year gilts, meanwhile, have reached levels not seen since 1998. A wall of worry that keeps getting taller Peters described the current environment using a familiar market metaphor: investors are climbing a “wall of worry.” The catalyst behind this bond selloff is a cocktail of forces that have been simmering for months. Persistent inflation remains stubbornly above central bank targets in several major economies. Escalating oil prices, driven in part by geopolitical tensio...