STRONG US ECONOMIC OUTLOOK BUFFERS STOCKS AGAINST RISING YIELDS

A strong economic outlook is helping U.S. stocks weather a rise in Treasury yields, though that could change if factors such as tighter monetary policy drive yields higher or if they move up too fast. The S&P 500 and 10-year Treasury yield had been negatively correlated - meaning they have moved in opposite directions - since long-term yields began rising last July, Goldman equity strategists led by David Kostin said in their latest weekly kickstart note.

The S&P 500 sold off sharply over that period as yields marched to a 16-year high in October, making stocks relatively less attractive. Equities staged a swift rebound when yields, which move inversely to bond prices, tumbled in the final months of the year.

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