/These cheap stocks positively correlated to rising rates are ready to run, Credit Suisse says
These cheap stocks positively correlated to rising rates are ready to run, Credit Suisse says

These cheap stocks positively correlated to rising rates are ready to run, Credit Suisse says

Pedestrians walk passed signage at Cigna headquarters in Bloomfield, Connecticut.

Michael Nagle | Bloomberg | Getty Images

The recent rise in interest rates could be a signal to move into value stocks, according to Credit Suisse.

The benchmark 10-year Treasury yield was rising back toward the 1.5% level after breaking through that level last week. The measure was trading below 1% at the start of the year, making this an unusually sharp rise, fueling some concern about a rise in inflation during the economic recovery from the pandemic.

Inflation and rising rates are seen as a negative for many stocks because they can make higher valuations seem less attractive, and “the valuation of growth relative to value is clearly extreme,” according to Credit Suisse’s Andrew Garthwaite.