Market interest rate vs. Equity price? equity, discount, market, interest, higher

mamuka12

Would higher market interest rate = lower equity price? As we have to discount the cash flows back at higher a rate?

19831985

It would lead to a lower justified equity price using the DDM, FCF, or RI models.

NO EXCUSES

YAhmed

Also consider the asset allocation part of the story... When interest rates are higher, fixed income securities may attract higher investor attention and steal some share of investments made in equities.