A sharp jump in 10-year Treasury yields scared stock-market watchers, even as the auction of new 5-year notes was well received. And mortgage rates, especially the 30-year fixed rate, ticked higher.
Art Cashin, UBS Financial Services director of floor operations, offered CNBC his market insights.
Turmoil in the mortgage market was "in response to that rout in the 10-year," Cashin explained.
"Bernanke was building his whole concept on heading down" to zero interest rates, Cashin said. "So to see mortgages rise has to be very frustrating."
Who's Driving the Rally?
Turning to the stop-and-start stock rally, Cashin voiced concerns over where the investment money is coming from. His sources, who have the ears of fund portfolio managers, say long-term institutional buying "is dead." Instead, "you're getting sector speculation now."
"The rally has been primarily in stocks that that were beaten down. Which suggests it's a little bit short-covering, the rest is speculating. ...Kind of like buying lottery tickets."
Cashin joked about the "deadly wrong aphorism on Wall Street: 'It's only $2 — what can I lose?'"
"Well, you can always lose 100 percent."
More from the master:
CNBC's Companies in the News:
Procter & Gamble
Bank of America
Disclosure information was not available for Cashin or his company.