McDonald's Stock Mirrors 32% Rise in 10-Year Treasury Yield

McDonald's stock has been on a downward trend since early March, falling about 32% to $233.60 by September 28.

This mirrors the rise of the 10-year US Treasury yield over the same period, which climbed almost exactly the same 32% to a 19-year high of 5.24%.

The Chicago Board Options Exchange (Cboe) 10-Year Treasury Yield Index (TNX) and McDonald's share prices have been moving in opposite directions for about seven months, with yields rising on 19 out of the last 23 trading days.

Tom Lee, co-founder and head of research at Fundstrat Global Advisors, replied to a post highlighting this trend by saying 'Interesting. Not sure why $MCD is negatively correlated to yields. But still interesting.'

Theories have emerged to explain this unusual correlation, including higher borrowing costs for McDonald's due to its large debt load, consumer strain caused by menu price increases, and the Federal Reserve's interest rate hikes.

However, none of these theories can fully account for the precision of the opposite trend between the two lines, with some attributing it to mere coincidence.