NEW YORK (TheStreet) -- After jumping higher shortly after the open on Wednesday, the S&P 500 is up a modest 0.25%. The focus remains on bonds, with yields on the 10-year Treasury bond are up a robust 4.4%.
Financial stocks are moving higher as a result of the higher rates, Pete Najarian, co-founder of optionmonster.com and trademonster.com, said on CNBC's "Fast Money Halftime" show.
Also as a result of higher yields, the iShares 20+ Year Treasury Bond ETF (TLT) is also down 1.5%, added Josh Brown, CEO and co-founder of Ritholtz Wealth Management. It looks like the ETF wants to test the lows it made in September, near $111, which would represent a "pretty substantial decline."
"Stocks are relatively cheap" from a valuation perspective, given that bond yields are still so unattractive, explained Jon Najarian, co-founder of optionmonster.com and trademonster.com.
Interest rates have been depressed for a very long time, thanks in part to global central banks pushing rates lower. Now, rates are looking to move higher than in part to the Federal Reserve, said Howard Lutnick, chairman and CEO of BGC Partners and at Cantor Fitzgerald. However, the increase will not be significant and to most Americans, it will be a "slow and steady" path of increasing rates, he said.
The recent surge in bond yields is likely reflecting the likelihood that the Federal Reserve will indeed raise interest rates this fall, said Jim Lebenthal, president of Lebenthal Asset Management. He also made the case that the global economy is in the midst of a recovery.