- Rising interest rates have sparked a surge in stock-market volatility that’s seen tech shares take a sharp dive.
- But investors should not fear rising interest rates, according to a recent client note from The Leuthold Group.
- “Yields may be rising, but yield pressure is still extremely low because real growth is improving even faster,” said Jim Paulsen, the firm’s chief investment strategist.
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A spike in interest rates since the start of the year has accelerated a rotation out of high-growth technology stocks and into value stocks poised to benefit from a reopening of the economy.
The Nasdaq has fallen more than 10% over the past month as the Dow has soared to record highs, with a spike in the 10-year US Treasury yield acting as the main catalyst. It