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Bond Selloff Pressures Stocks as Oil Crosses $91 a Barrel
Renewed Middle East fighting and rising inflation fears pushed benchmark yields higher as markets priced near-term rate hikes in the United States, Europe and New Zealand.
- Global bond yields surged to multi-year highs on Tuesday as renewed fighting in the Middle East pushed Brent crude prices above $91 a barrel, with German and French long bond yields hitting 15-year peaks.
- Heightened US-Iran tensions and conflict between Russia and Ukraine are stoking inflation concerns, prompting BNY APAC Macro Strategist Wee Khoon Chong to warn that geopolitical and inflation risks are pressuring yields.
- The 10-year Treasury yield rose to 4.78%, while Japan's 10-year benchmark neared 3%, a generation-high level. The Hang Seng fell 0.7% as clothier Shein Global posted a lackluster market debut.
- Markets are pricing potential interest rate hikes in New Zealand on Wednesday and Europe next week, with odds of increases in Japan better than even as investors await Friday's jobs data.
- Chong added that hawkish monetary policy and rising fiscal concerns are converging to maintain upward pressure on global yields. This challenging macro mix keeps investors nervous as a potential hiking cycle looms this month.
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Coverage Details
Total News Sources7
Leaning Left0Leaning Right2Center4Last UpdatedBias Distribution67% Center
Bias Distribution
- 67% of the sources are Center
67% Center
C 67%
R 33%
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