Moderating inflation and its likely effect on the bond market bode well for U.S. stocks, Ben Gutteridge, director of Invesco's Model Portfolio Service, suggested Friday.
The current U.S. stock market valuation is "quite well supported here on the back of what's happening on the long end of the bond market," he said on CNBC's Squawk Box Europe.
"The inflationary challenges do seem to be receding," Gutteridge said. "It could be tempered by some hawkish commentary here and there from central banks, from the Federal Reserve, but ultimately I think the inflationary challenges are moderating, and actually are growth challenges as well, and that should allow bond yields to be capped in and around where they are, could even drift a little lower from here, and that would be good news and supports the U.S. stock market valuation."
