MarketWatch: “Debt ceiling debate: How U.S. government debt and stocks will perform if a resolution is reached, says DataTrek”By datatrekresearch in IN THE NEWS
Excerpt from MarketWatch quoting DataTrek co-founder Nick Colas:
.... "Wall Street was watching as President Joe Biden said Wednesday that he is confident that the White House and congressional leaders would reach a deal on the debt ceiling.
One worry is that once a resolution is reached, the government could start to issue new debt, which might push Treasury yields higher, and in turn weigh on stocks.
But that isn’t likely to be the case, according to Nicholas Colas, co-founder of DataTrek Research, who based his argument on historical data, current trends in inflation expectations and real rates.
While analysts have been cutting their S&P 500 index SPX, +0.94% earnings estimates for the rest of the year, the market would need lower Treasury yields to support equity valuations at current levels, Colas said in a Wednesday note"....
Full article here on MarketWatch.