Asia stocks cautious as oil gains and yields rise
Brent rose 1.6% to $106.00 a barrel and US crude added 1.1% to $93.47. The 30-year Treasury yield nudged up to 5.5185% while the dollar index hit two-month peaks.
Oil prices up over 1% after Trump rejects Iran deal Nikkei edges up, S&P 500 futures soft Bond yields rise on inflation concerns, Fed outlook By Wayne Cole SYDNEY, Sept 28 (Reuters) — Share markets made a cautious start on Monday as oil prices popped higher again amid doubts the United States and Iran will reach a truce anytime soon, keeping bonds under pressure ahead of a week packed with economic news. Over the weekend, US President Donald Trump rejected an Iranian proposal to reopen the Strait of Hormuz, claiming Tehran was desperate to make a deal. Trump said talks would continue this week, though Iran shows no sign of watering down its proposals. 47 a barrel.
O/R A dearth of refining capacity has in turn lifted diesel prices to all-time highs far above crude, raising the risk that inflation will become embedded in pricing and wage decisions. Central banks have responded with a round of rate hikes, with the Reserve Bank of Australia likely to be the next to tighten when it meets on Tuesday. Markets now imply a 66% chance the Federal Reserve will hike for a second straight meeting in October, with around 90 basis points of tightening priced out to late next year. At the same time, a run of strong US economic data has supported expectations for corporate earnings even as bond yields surge, so underpinning equities.
0% for this quarter. Activity has also proven upbeat in Asia and Europe, thanks in part to the boom in AI investment. "The global expansion appears to have entered a phase of broad-based strength rarely seen over the past two decades," said Bruce Kasman, chief economist at JPMorgan. "Amidst strong growth and firming perceptions of resilience to high energy prices, it is no surprise that rates are moving higher while equity prices remain close to record levels," he added.
6%. 2%. 2%. 2%, while Nasdaq futures were flat.
5185%, near their highest since 2004, having climbed 27 basis points just this month. Two-year yields have shot up 55 basis points this month in anticipation of Fed hikes. Mark Cabana, a rate strategist at Bank of America, sees further room for bonds to sell off as markets price higher Fed Funds. "The repricing may not stop until there's clear evidence that financial conditions have become sufficiently restrictive," he warned.
The spike in yields raises borrowing costs globally just as tech firms are borrowing billions to fund their AI expansion, while also lifting the discount applied to company earnings. The US data calendar is packed with readings on inflation, GDP, manufacturing and jobs. 0%. 39.
0% so far this month. 53 yen, after dipping on Friday when Japan's Finance Minister Satsuki Katayama said Trump had voiced concerns about yen weakness. 3228, having been helped somewhat by hawkish comments on rates from Bank of England Governor Andrew Bailey. 5% at $4,262 an ounce, having fallen more than 4% this month as yields shot higher.
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