Yields on 10-year Treasury bonds soared from 2.08% in mid December to a recent 3.29% -- a jump of 58%. What is the implication for the stock market? The following relationships should be useful in the current financial climate.
1. A decline in stocks is followed by a decline in bond yields.
2. A decline in bond yields is followed by a rise in stocks.
3. A rise in stocks is followed by a rise in bond yields.
4. A rise in bond yields is followed by a decline in stocks.
5. Go to item 1.
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