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A specialist looks at a screen at his post on the floor of the New York Stock Exchange
A specialist looks at a screen at his post on the floor of the New York Stock Exchange
(Richard Drew/AP)

Rising corporate yields would wallop S&P 500

Rising risks in corporate bond markets are putting S&P 500 profit growth in jeopardy.

For U.S. companies, declining corporate bond yields mean cheap borrowing rates, and CFOs have taken advantage. In recent years, funds borrowed in bond markets were used to refinance existing debt, in order to lower interest expenses as well as to buy back shares. The result was a boost to profits at a time when revenue growth was extremely slow.