Bond Yields Climb, JPMorgan Warns of Equity Risks

JPMorgan is warning investors about rising bond yields and their potential impact on global equities. The bank's co-head of global investment strategy, Grace Peters, told Bloomberg Television that bond yields climbing into the 5% to 5.25% range pose a meaningful risk to stock valuations.

The current environment is characterized by a 'wall of worry' for investors, according to Peters. Bond yields are surging globally due to persistent inflation and escalating oil prices. 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.

The Federal Reserve, European Central Bank, and Bank of Japan are all adjusting their policy outlooks in response to inflation and energy price pressures. The Bank of Japan's 10-year yield crossing 3% signals a tectonic shift in Japanese monetary policy.