Ruchir Sharma Says 10-Year Treasury Yield Above 5% Could Pressure Stocks and AI Trade

According to CNBC, Breakout Capital founder Ruchir Sharma said a decisive move above 5% on the 10-year Treasury yield could hurt equity markets broadly and put the artificial intelligence trade under particular pressure. He said the 10-year Treasury is the most important asset in the world because it affects stock valuations and sets borrowing costs for mortgages, auto loans and other debt, and he added that equity prices tend to fall when yields rise above 5.25%. The benchmark 10-year yield touched 5% earlier this week and a 19-year high before easing 5 basis points Thursday to 4.94%. Sharma also said persistent inflation and higher interest rates have historically ended major market booms, while Goldman Sachs said higher capital costs and greater capital intensity in tech have reduced the value of future cash flows.