Stocks fell Thursday and have the appearance of being weak heading into the weekend.
Local financial advisor Howie Pentony explains.
“Interest rates are going up a little bit. For instance the 10 year Treasury bond was yielding around one half of 1% in past months,” Pentony said. “Now it’s heading toward one and a half percent.”
Pentony says that sometimes when interest rates increase, investors may switch their investment strategies.
“When interest rates go up and bonds become more attractive, then dividend paying stocks sometime become less attractive. So it looks like a little switch off between dividend paying stocks and bonds.”
Pentony also added that’s this is a common occurrence in the market when rates rise.