(Bloomberg) — Stocks chalked up a modest rebound as traders tracked the selloff in long-dated bonds, fueled by anxiety over inflation and mounting government debt. Gold hit a fresh all-time high.
European stocks rose 0.3% after suffering their steepest loss in a month in the previous session. Nasdaq 100 futures advanced 0.5% as Alphabet Inc. rallied in extended trading on Tuesday, buoyed by a ruling that Google won’t be forced to sell its Chrome browser. Contracts on the S&P 500 climbed 0.3% after two days of losses.
While equities found firmer footing, the bond selloff deepened. The yield on 30-year Treasuries climbed three basis points, coming within a whisker of the 5% threshold. Japanese debt joined the rout, with 20-year yields hitting the highest since 1999. UK gilts weakened further, while euro-area bonds proved more resilient.
The fragility of bonds underscores the strain from heavy public spending, which demands ever-rising bond issuance, and a broader erosion of confidence in sovereign credit. That uncertainty has spilled into equities, where traders are grappling with stretched valuations after a record rally, alongside persistent concerns over monetary policy and inflation.
“I don’t see this movement as a threat to the rising trend of stock markets,” said Roland Kaloyan, head of equity strategy at Societe Generale SA. “We don’t see yields rising much further than their current levels. That being said, this bond selloff means that there will be an even greater focus on Friday’s US job data and their impact on the Fed’s easing policy.”
Gold’s latest record comes as growing expectations for US interest-rate cuts bolster the metal’s attractiveness. The drop in bond and equities has also strengthened its appeal as a haven. Bullion climbed as much as 0.4% to hit 3,546.96 an ounce before paring gains.
“President Trump’s continued efforts to erode the Fed’s policy independence are also shaking confidence, in turn helping hard assets such as gold,” wrote Michael Brown, senior research strategist at Pepperstone Group Ltd. “The bull case remains intact.”
Corporate News:
Alphabet Inc.’s Google will be required to share online search data with rivals while avoiding harsher penalties, including the forced sale of its Chrome business, a judge ruled in the biggest US antitrust case in almost three decades. Alphabet shares rose in after-hours trading. The US has revoked Taiwan Semiconductor Manufacturing Co.’s authorization to freely ship essential gear to its main Chinese chipmaking base, potentially curtailing its production capabilities at that older-generation facility. TSMC shares retreated in Taiwan. Apple Inc.’s lead artificial intelligence researcher for robotics has departed the company to join Meta Platforms Inc.’s competing effort, part of an exodus of AI talent from the iPhone maker. A group of Thames Water’s senior creditors has submitted a new operational plan to the UK regulator as part of its bid to rescue and take over the ailing utility. Hong Kong is probing allegations of insider dealing that involve at least two individuals at the stock exchange and the city’s financial regulator as well as brokers and social media influencers. Some of the main moves in markets:
Stocks
The Stoxx Europe 600 rose 0.3% as of 9:05 a.m. London time S&P 500 futures rose 0.3% Nasdaq 100 futures rose 0.5% Futures on the Dow Jones Industrial Average fell 0.1% The MSCI Asia Pacific Index fell 0.8% The MSCI Emerging Markets Index was little changed Currencies
The Bloomberg Dollar Spot Index was little changed The euro was little changed at $1.1641 The Japanese yen fell 0.2% to 148.71 per dollar The offshore yuan was little changed at 7.1456 per dollar The British pound fell 0.1% to $1.3374 Cryptocurrencies
Bitcoin fell 0.2% to $111,212.14 Ether was little changed at $4,318.2 Bonds
The yield on 10-year Treasuries advanced three basis points to 4.29% Germany’s 10-year yield declined one basis point to 2.77% Britain’s 10-year yield advanced two basis points to 4.82% Commodities
Brent crude fell 0.5% to $68.82 a barrel Spot gold rose 0.1% to $3,537.23 an ounce This story was produced with the assistance of Bloomberg Automation.
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