Bond vs Equity – Earnings Yield Gap Update

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Bond vs Equity – Earnings Yield Gap Update

Currently:
🔹 10-Year Bond Yield: ~6.7%
🔹 Equity Earnings Yield (Nifty 50): ~5.0%

📉 The gap between bond yield and equity earnings yield has widened.

📌 What does this mean?
• Bonds are offering relatively attractive yields
• Equity markets will now need strong earnings growth to justify valuations
• Market focus is shifting more towards corporate earnings performance

🧠 Key takeaway:
Going forward, stock selection and earnings growth will be more important than liquidity-driven rallies.

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