Interest rates & stock market returns

Eddy over at CrossingWallStreet did an analysis of rising/falling/steady bond yields and the return of the broad U.S. stock market.

If we isolate just those days when the T-bill rate fell, the S&P 500 was up a cumulative total of 2,537.0%, which is about 17.4% annualized. For the days when the yield was unchanged, the S&P 500 was up 105.4%, or 11.7% annualized. On the days when the yield rose, the S&P lost -55.4%, or -3.9% annualized.

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