JPMorgan warns 5% Treasury yield could trigger equity correction

JPMorgan says a 5% U.S. 10-year Treasury yield could become the psychological threshold that finally pressures equities more significantly.
The firm sees the potential for a 5%-8% stock-market correction into the midterm elections if yields continue climbing, although it would view such a decline as a healthy pullback rather than a structural break in the bull case.
JPMorgan remains constructive on equities over the longer term, with its thesis centered on a capex-driven earnings supercycle.
The larger medium-term question is whether the enormous investment in AI infrastructure ultimately generates sufficient returns.