BofA warns bonds to steer clear of 'line-in-sand' to support stocks

Bank of America strategist Michael Hartnett warns that if bond yields go above 5% for an extended period, stocks could be in trouble. However, recent economic data, including the September jobs report and easing inflation, suggests a Goldilocks scenario for the market. The impact of higher yields on business activity and signs of a small business credit crunch causing higher unemployment could be bearish signs for stocks. Hartnett believes that a recession and Fed rate cuts are needed to ignite new bullish momentum in the market.