'Strong' Market Can Absorb Rising Rates

As stocks overcame weak housing data Tuesday morning, market experts shared insights on “Morning Call.”

Scott Fullman, director of investment strategy at Israel A. Englander, highlighted the market’s “strong resiliency.”

Although the market is retreating from May’s strong economic data, he said, it’s more tolerant to rising interest rates. And 5.25% has become the new threshold on the U.S. Treasury note, he added. That new standard is “healthy, though, because the fact is the market does have to adjust,” Fullman said.

Bill Nichols, senior managing director of equity at Bear Sterns, said new highs for “mega-caps” – specifically, General Electric (CNBC’s parent company) and IBM – are good for the overall market. “We’ve seen the big cap companies have their day,” he said.

But, he added cautiously, “I don’t know that, if you’re looking ahead three to six months, whether you can draw any conclusions from that.”