US Stocks and Treasuries Fall as Oil Pushes Higher - Europe Market Wrap
US stocks fell alongside Treasuries as fading hopes for a near-term breakthrough in the Iran war pushed oil prices higher and revived inflation concerns. Tehran refused to ease its demands for reopening the Strait of Hormuz, while mixed signals from Trump on further talks drove Brent above $108 a barrel. Treasuries weakened across the curve as traders increased bets on further Fed tightening. The five-year yield rose around 7 bps to 5.06%, while markets priced roughly a 70% chance of a Fed rate hike next month, up from about 65% on Friday. Nasdaq 100 futures fell around 1%, while S&P 500 futures slipped 0.5%. Chipmakers were among the biggest decliners in Asia, while Europe’s Stoxx 600 was little changed. The Dollar resumed its advance, Gold extended its September decline to more than 6%, and Bitcoin fell below $83,000. Oil remained the main driver across markets as investors weighed geopolitical risks against still-resilient corporate earnings and major economies. Higher crude prices are keeping bond yields near multi-year highs and feeding through to other asset classes as concerns over inflation remain elevated. Attention now turns to upcoming US inflation and labour-market data
US stocks fell alongside Treasuries as fading hopes for a near-term breakthrough in the Iran war pushed oil prices higher and revived inflation concerns. Tehran refused to ease its demands for reopening the Strait of Hormuz, while mixed signals from Trump on further talks drove Brent above $108 a barrel. Treasuries weakened across the curve as traders increased bets on further Fed tightening. 06%, while markets priced roughly a 70% chance of a Fed rate hike next month, up from about 65% on Friday.
5%. Chipmakers were among the biggest decliners in Asia, while Europe’s Stoxx 600 was little changed. The Dollar resumed its advance, Gold extended its September decline to more than 6%, and Bitcoin fell below $83,000. Oil remained the main driver across markets as investors weighed geopolitical risks against still-resilient corporate earnings and major economies.
Higher crude prices are keeping bond yields near multi-year highs and feeding through to other asset classes as concerns over inflation remain elevated. Attention now turns to upcoming US inflation and labour-market data. The release will include the Fed’s preferred inflation gauges, with both headline and core PCE expected to accelerate in August from the previous month, while payrolls data is expected to show that hiring remained solid.