These stocks could benefit if interest rates break out higher
A handful of stocks may be well positioned to benefit from rising Treasury yields, according to Bank of America. Both the benchmark 10-year and 30-year Treasury have climbed recently to reach worrisome milestones. The 10-year yield was last at about 4.43%, just shy of the key 4.5% level, and up from 4.01% in early April. The yield on the 30-year bond stands just under 5%, also a key level that's drawn investor attention, and up from 4.41% when President Trump unveiled sharply higher tariffs on imported goods. The rise in Treasury yields largely reflects investor concern tied to the health of the U.S. economy, the size of the government debt and the state of the dollar. When the Court of International Trade on Wednesday struck down most of President Donald Trump's tariffs, the White House immediately appealed the decision, saying "it is not for unelected judges to decide how to properly address a national emergency." The ruling was stayed the next day by an appeals court, leaving investors continuing to question the direction of U.S. trade policy. Yet, despite all the confusion, investor appetite for risk assets has grown in the past two months , while demand for Treasury debt has waned. Against this backdrop, Bank of America looked for stocks that outperform the S & P 500 the most when 10-year Treasury note yields rise, measuring performance against month-over-month changes in the 10-year yield since 2014. Financials dominate the screen, accounting for six of the top 10 spots. Here's a look at the names that floated to the top of BofA's model. Prudential Financial snagged the top spot on the list with a 48% correlation to changes in the 10-year yield. Stock in the insurance and retirement planning giant has pulled back more than 12% so far in 2025. Its dividend yields 5.2%. PRU YTD mountain Prudential Financial stock in 2025. Nearly two thirds of analysts maintain a hold rating on Prudential stock, with their consensus price target implying 9% upside. Prudential beat Wall Street analysts earnings estimates when it reported first-quarter results in late April. JPMorgan Chase also made the cut. The bank yields 2.1% and shares have added more than 10% so far in 2025, while the S & P 500 has risen less than 1%. What's more is the bank's 35% correlation to changes in the 10-year yield. CEO Jamie Dimon has warned more than once this year that the economy could be headed for a recession, but JPMorgan Chase has outperformed, recently reporting first-quarter results that topped analyst estimates, fueled by strong profits from its trading desk. JPM YTD mountain JPMorgan Chase shares in 2025. Roughly 59% of analysts surveyed by FactSet rate JPMorgan Chase a buy, with the consensus price target implying a little more than 3% upside. Other names on the list include Charles Schwab and MetLife .
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