Fidelity's Timmer Warns Rising Rates Can Hurt Stocks Unless Earnings Keep Pace

Fidelity's Jurrien Timmer said rising rates can erode stock valuations unless earnings growth offsets them, and sees no bubble today if margins and credit spreads hold. Fidelity's September note put forward P/E near 19 and expected earnings growth near 20%, according to BeInCrypto; Timmer said yields near 6%—a possibility, not a prediction—could imply a P/E closer to 16. The 10-year Treasury yield reached 5.05% on Oct. 29; junk spreads were 3.37 percentage points, up from a 2.67 low, while the ICE BofA spread eased to 3.18 on Oct. 27 from 3.40 on Oct. 22. Global corporate spreads hit their widest since May 2025 on Oct. 23 as concerns over debt-funded AI spending grew.