MarketWatch – Here’s the line in the sand for bonds — and stocks — that ‘everyone’s talking about’

Critical information for the U.S. trading day

By: VICTOR REKLAITIS

What’s in a number?

Perhaps quite a bit — even if it’s just because other folks are so hung up on it.

The big number this week could be the 3% level for the 10-year Treasury yieldTMUBMUSD10Y, +0.42%  , with strategists buzzing about whether a rise to that spot will upset stocks.

There’s also clamor today about new partisan battles over Russia and the upcoming State of the Union speech, but many finance geeks sound most interested in the bond market’s latest shakes.

“No one knows what the number is on 10s when this really starts to unravel. But if you’re the type who puts any stock in psychological levels, 3% has a not-so-nice ring to it,” says the blogger behind the Heisenberg Report for our call of the day.

While rising yields signal a robust economy, the speed of the move up is key, the blogger warns: “Too far, too fast is not good, and past a certain point, equities’ interpretation of that yield rise will change.”

It’s not you, it’s not me — it’s them, according to the Heisey scribe: “This is another one of those ‘everyone’s talking about it’ things, so make sure you’re at least in the loop.”

Other takes include one from Credit Suisse’s soothsayers, who suggest not frettingabout the U.S. stock-market rally until the yield on 10s reaches 3.5%. (It was around 2.69% at last check after topping 2.70% for a three-year high yesterday.)

Meanwhile, Peter Tchir from Academy Securities cautions: “If we are at 3% by the end of this week, I don’t see stocks surviving that very well.”

Key market gauges

Futures for the Dow YMH8, -0.98%  , S&P 500 ESH8, -0.70%  and Nasdaq-100NQH8, -0.78% are lower, with the blue-chip barometer on track for a triple-digit drop. That’s after the Dow DJIA, -0.67%  , S&P SPX, -0.67% and Nasdaq CompositeCOMP, -0.52% suffered falls of 0.5% to 0.7% yesterday, retreating from Friday’s record levels.

Europe SXXP, -0.78% and Asia have been seas of red, as oil CLH8, -1.28% , the dollarDXY, -0.42% and bitcoin BTCUSD, -6.02% also lose ground. Gold GCG8, +0.45% is up though.

See the Market Snapshot column for the latest action.

The chart
MetLife’s shares slump.

MetLife MET, -8.46%  — the big insurer known for its “Get Met. It Pays” slogan — failed to pay monthly pension benefits to possibly tens of thousands of workers.

That has helped bring about a delay for the company’s earnings report — as well as a selloff in the extended session.

The buzz

Amazon AMZN, -1.24%  , Berkshire Hathaway BRK.A, -0.74% and J.P. MorganJPM, -0.99% plan to form a new company targeting health care, and that’s hitting that industry’s stocks XLV, -2.40%  .

The Woz doesn’t trust Elon Musk or Tesla TSLA, -1.17% any more.

McDonald’s MCD, -0.44% , Pfizer PFE, -1.67%  , Aetna AET, -3.36%  and Harley-Davidson HOG, -6.42% are on the earnings docket before the open.

Janet Yellen’s last meeting as Federal Reserve boss starts today, and a more hawkish statement from the central bank is expected tomorrow when the confab ends.

In political news, a House panel has voted to release a secret Republican memo about the ongoing Russia probe, the U.S. has issued a “Putin list” of 210 top Russian baddies but has not backed more sanctions, and the director of the CIA expects Russia will target this year’s mid-term elections. And this all comes after an FBI deputy director’s exit yesterday.

lightly-sourced report says Microsoft MSFT, -0.49% has considered buying videogames producer Electronic Arts EA, +0.09%   .

Volkswagen VOW3, -2.23% VLKAY, -0.57% says no more animal testing after outrage over an Albuquerque lab’s experiments with monkeys.

Thomson Reuters shares TRI, +8.40%  look set for an up day after news of a Blackstone bid.

A BuzzFeed report says the U.K. government’s analysis of Brexit shows the country will be significantly worse off outside the European Union, regardless of what deal is struck.

The quote

“We’re going to get something done. … Hopefully the Democrats will join us, or enough of them will join us, so we can really do something great for DACA and for immigration, generally.” — President Trump says tonight’s speech will cover immigration.

A top White House official has spoken with MarketWatch ahead of the speech, talking up the tax law and the stock market’s gains.

Read more: How the stock market has reacted to State of the Union speeches

And see: State of the Uniom? Typo forces tickets to be reissued

Random reads

Treasure news: Once-lost gold goes on display, $496K worth of chocolate got stolen.

A North Face founder’s dream for Chile’s national parks becomes reality.

Indian man dies in a freak accident involving an MRI machine and oxygen cylinder.

Tom Hanks wants to be your neighbor and star in a Mr. Rogers movie.

Read the full article in its original forma at MarketWatch.com

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