Rising yields and falling prices in bonds mark the end of a rally, not the start of a selloff, Silvercrest Asset Management's chief strategist said Thursday.(Tweet This)
"I think you've got to put it in context. People talk about a bond selloff. This is actually the end of a couple of bond rallies that have taken place this year, first of all in Europe on the back of QE," Patrick Chovanec said on CNBC's "Squawk Box," referring to the European Central Bank's stimulative quantitative easing program.
The United States has also gone through two bonds rallies this year, including one in January that was steeper than the current bond boom and bust, he said, noting that the 10-year U.S. Treasury yield is currently just above it's year-beginning level.
On Wednesday, the U.S. 10-year yield ended the day above 2.29 percent, its highest close this year. Yields move inversely to bond prices.
The fall in bond prices has no easy explanation, Chovanec said, but can be traced to several factors, including a rush of European bond-buying before quantitative easing could drag down yields, global deflation fears that resulted in the two U.S. bond rallies, and reduced bond market liquidity as more heavily regulated banks are less able or willing to make markets.
Asked whether U.S. equities can maintain current valuations in the face of the rise in bond yields, Chovanec said what really matters for stocks are earnings, which he called "disappointing" in the first quarter. Rising bond yields present an alternative to stocks, which have offered higher returns in recent years.
While the strengthening of the U.S. dollar is easing and falling oil prices appear to be stabilizing, investors needed to see retail sales rise in April, he said. The U.S. Commerce Department on Wednesday reported retail sales were flat last month.
Stephen Freedman, head of cross-asset strategy at UBS Wealth Management, said he is not convinced markets have moved to a mode in which good news is good news and bad news is bad news.
"I think for the time being, there is the tension of understating what these rising bond yields mean and ultimately what economic growth data will mean for second quarter earnings," he told "Squawk Box."
The second quarter was a "pretty good" quarter for profits if not revenue, he said, noting that earnings came in 6 percent above what UBS Wealth Management had predicted ahead of the reporting season.
UBS is expecting high single-digit growth for U.S. stocks this year, excluding the energy sector, he said.
—CNBC's Robert Hum and Klaire Odumody contributed to this report.