FYI: A plunge in bond yields has left investors with few alternatives to stocks.
The latest flare-up in trade tensions has quickened investors’ flight to haven assets, pushing bond yields down to their lowest levels in years. Wall Street analysts say the pullback in yields, along with a new phase of monetary loosening by central banks around the world, should give investors a new rallying cry for the second half of the year: “There is no alternative” to stocks, known as the Tina effect.
Nearly 60% of stocks in the S&P 500 offer a dividend yield of at least 1.7%, according to FactSet, better than the 1.640% yield where 10-year U.S. Treasurys settled Monday. AT&T Inc., T +1.19% cereal maker General Mills Inc. GIS +0.15% and memory chip company Western Digital Corp. WDC +3.05% are among the highest-yielding—and best performing—stocks in the index this year. Each has dividend yields of at least 3.6%, while yields across the broad index average about 2%.