Stocks have so far survived rising Treasury yields. But that may be about to change.

For much of the recent period, rising Treasury yields have not derailed the stock market. Strong corporate earnings growth has provided an offset, allowing equities to absorb higher bond rates without a sustained selloff. In effect, profit expansion has done the heavy lifting that cheaper borrowing costs once did.

That cushion may be thinning. Yields have continued climbing rather than stabilizing, and the tension between equity valuations and bond yields tends to build gradually before it shows up in prices. Higher yields raise the discount rate applied to future earnings, which pressures the multiples investors are willing to pay — particularly for growth-oriented names whose value rests on profits expected further out.

What to watch: whether earnings growth remains strong enough to keep offsetting higher rates, and whether yields level off or keep grinding upward. A sustained move higher in bond rates, without a matching earnings response, would shift the calculus for equity investors. For now, the relationship is one of growing strain rather than a break.