RBC’s Calvasina says 5% Treasury yield would pressure S&P 500 bulls

RBC Capital Markets’ Lori Calvasina said bullish calls on U.S. equities would face pressure if the 10-year Treasury yield reaches 5%, a level she said typically weighs on price-to-earnings multiples. The U.S. 10-year yield was about 4.54% on May 15, 2026, amid a global bond selloff tied to higher oil prices, inflation concerns and fiscal risks. Calvasina raised her 12-month S&P 500 target to 7,900 from 7,750 in the week before May 15, based on $329 in earnings per share, a 4.5% 10-year yield, steady Federal Reserve rates and 3.3% inflation. She said the target would fall to 7,400 if inflation rose to 3.8%, the 10-year yield hit 5% and the Fed raised rates. If earnings fell 5% under RBC’s early-2027 EPS model, S&P 500 fair value would drop to 6,300, she said.