1) Interest Rate Spike: With leading economic indicators still pointing upward, the risk of a near-term recession remains low at this point. The main risk that investors face here is rising interest rates. The yield on the 10-year U.S. Treasury Note is currently approaching 3%. While this is still very low by historical standards, at a certain level it will become a headwind for the economy and U.S. equities. With the current trend in rates still up and continued improvement in economic data, a breakout higher above 3% resistance seems likely (see chart below). Back in 2010 and 2011, when the 10-year yield moved above 3.6% it became an issue for equities (we saw corrections of 17% and 21% in those years). If rates continue to rise from here, it will be important to watch the reaction in the equity markets.