Rates and Stocks: Scauri Sees a Possible Peak in Yields and Focuses on Selection

Reworking and updating of Andrea Scauri’s analysis, manager of the Lemanik High Growth fund

The rise in bond yields does not necessarily mean the end of opportunities in equities, but it does make it more important to understand which companies can sustain a high cost of capital without undermining earnings and investment. That is the common thread in the analysis of Andrea Scauri, manager of Lemanik High Growth, who maintains a constructive view of equities and sees pullbacks as an opportunity to pick solid companies. His hypothesis of a peak in rates, however, should be read as a management scenario, especially with regard to the evolution of market yields, and not as a peak already certified by central banks or a guarantee of subsequent declines.

The distinction matters because the cost of money set by the Federal Reserve and the ECB does not coincide with the yield on a 10-year Treasury or BTP: longer maturities are also affected by inflation expectations, growth, debt supply and the premium demanded by investors. A market can therefore anticipate a stabilisation in official rates while bond yields remain high, or react to a revision in economic prospects without waiting for a monetary decision. To understand Scauri’s thesis, one must start from this relationship and its practical consequence: select companies with robust cash flows and sustainable debt levels, rather than basing the entire portfolio on a single rate forecast.

Central bank decisions and the inflation risk

The monetary backdrop available on 14 October 2026 calls for caution when speaking of a turning point already completed. On 16 September the Federal Reserve raised the target range for federal funds by 25 basis points to 3.75–4%, citing solid economic activity and inflation that remains elevated. On 10 September the ECB likewise decided on a 25-basis-point increase, taking the deposit rate to 2.50% from 16 September, the main refinancing rate to 2.65% and the marginal lending rate to 2.90%. The European central bank did not commit to any preset path beyond that: decisions remain tied to data and risks to price stability.

In Scauri’s reading, part of the pressure on yields reflects the resilience of nominal growth, not just fears of runaway inflation. However, this assessment does not remove the energy risk: in the ECB’s September projections, average inflation in the euro area is set at 3% in 2026 and 2.5% in 2027, with uncertainty over the direct and indirect effects of the shock in the Middle East. It is therefore necessary to separate the favourable scenario, in which the economy continues to generate profits and price pressures ease, from the one in which energy and financing costs squeeze margins. Expectations for the next hikes or cuts remain hypotheses, not decisions already taken.

Long yields and earnings remain the real test

The manager’s reference to U.S. Treasuries is also relevant for Piazza Affari, because a change in American yields can influence global financial conditions and the comparison between bonds and equities. There is, however, no automatic transmission of every move to Italian shares: Italy’s borrowing costs are also affected by the country risk premium and the European backdrop. Likewise, considering an industrial company more defensive because it has low leverage requires looking at revenue stability and its end markets. Low debt is a strength, but it does not make a stock immune to recession, volatility or earnings downgrades.

Among the risks Scauri highlights is also the ability of large technology companies to turn investment in artificial intelligence into sufficient revenue and profits. If financing becomes more expensive, very costly projects must demonstrate their economic return more clearly: the risk is that overly high expectations for AI benefits translate into cuts to investment plans or expected earnings. The link between long-term rates and technology spending remains, however, a relationship to be analysed company by company, taking into account cash availability, debt structure and operating results, without attributing to a single bond-yield threshold the power to determine the investment cycle on its own.

Utilities, technology and healthcare in the manager’s selection

Among the themes mentioned in the analysis are infrastructure and the energy transition, with Enel and ERG as examples of different exposures: the former is also linked to grids and regulated activities, while the latter is more directly tied to production from renewable sources. For Scauri, the appeal stems from the relationship between investment, valuation and regulatory risk, but the presence of structural demand is not enough to make any price attractive. Permits, incentives, financing costs and discipline in the use of capital all affect project profitability; the assessment must therefore distinguish the long-term outlook from the return the shareholder can reasonably expect from the price paid.

On the technology front, STMicroelectronics and Technoprobe are identified by the manager among the key positions in his analysis, while in healthcare DiaSorin is mentioned, bought according to the original contribution after a phase of negative news and share-price weakness. These are choices that express a specific assessment of the relationship between price and prospects, not an invitation to buy the sector indiscriminately. Semiconductors and diagnostics have different cycles, customers and risk factors: the ability to generate cash and support investment must be weighed against actual demand, competition and the expectations already embedded in share prices, which can also change quickly.

Financials, energy and industry without generalisations

The note shows greater selectivity on financials and mentions BPER, Unipol and Monte dei Paschi, while signalling a reduction in overall bank exposure. The point is to balance profitability, shareholder remuneration and the possible effects of the economic cycle on credit quality. Higher rates can support some margins, but they can also make funding and debt service more expensive for households and companies; moreover, the sensitivity of balance sheets to asset prices depends on the characteristics of the positions and their accounting treatment. Dividends are one component of return, not protection against capital losses, and distribution estimates should not be confused with amounts already approved.

Among the other names mentioned are Poste Italiane, Saipem, Fincantieri and Leonardo. In Saipem’s case, Scauri links the interest to valuations and to the prospects of the deal with Subsea7: the companies signed a binding merger agreement on 24 July 2025, but estimating the benefits also requires assessing the terms of the transaction, integration and execution risks. Fincantieri and Leonardo are mentioned after a reduction in multiples; here too, price must be weighed against orders, margins and financing needs. Poste Italiane remains among the securities mentioned in the contribution, without turning these references into a certification of the fund’s current positions, which may have changed since the original analysis.

A constructive view that must remain testable

The message to draw today is a preference for quality and selection, rather than the promise of an imminent drop in yields: a company with solid cash flows, controlled debt and competitive advantages can cope better with demanding financial conditions, but the purchase price remains decisive. Scauri’s thesis should therefore be tested over time against inflation, monetary decisions, corporate results and the ability to execute investments. The securities mentioned describe his contribution and do not replace a personal assessment of objectives and risks.