Equity and crypto rallies suggest bond-yield surge is transitory: Fundstrat's Tom Lee

• Q3 earnings growth is projected at almost 30%, with a significant portion being organic.
• Despite a 22% increase in 2027 S&P 500 earnings estimates, the market's P/E has derated by 10%, indicating investor skepticism.
• The Nasdaq hitting all-time highs and crypto rallying suggest that the current surge in bond yields (e.g., 10-year at 5%) may be transitory.
• U.S. jobs growth has slowed significantly (September +29K, average 60K/month in 2026), questioning the need for aggressive Fed tightening.

Thomas Lee of Fundstrat argues that market pessimism surrounding U.S. equities due to rising bond yields is overblown and likely transitory. He points to strong Q3 earnings growth, a P/E derating, and the resilience of Nasdaq and crypto as indicators that the market can tolerate current rates, especially with real growth remaining strong.